London house prices actually fell last month – but Londoners need a six-figure salary to afford to buy a home
Another day, another set of house price figures – but this time there's a bit of good news for those struggling to afford a home.
Yep – house prices in the capital actually fell in February on the month before – dropping to £524,000, from £540,000 in January.
But house prices can be volatile – and the figures also showed that in the capital, prices increased 9.7 per cent on the year before, compared with 8.2 per cent for the whole of the UK.
But could that monthly dip be a sign of things to come? The average salary of buyers in the capital fell during the final quarter of last year – albeit from £104,000 in the previous quarter, to a still-pretty-optimistic £101,000. Meanwhile, first-time buyers earned £81,000, down from £82,000 in the third quarter of 2015.
There's been plenty of speculation that the capital's housing market could be hit by new rules, which from 1 April added three per cent to stamp duty on buy-to-let homes.
Yesterday Morning Wire reported that as many as a third of sellers in some of London's most upmarket boroughs have been forced to cut the prices of their homes as they struggled to sell. Even one of the capital's most exclusive interior designers has fallen into a loss.
"There are signs that some areas [of the capital] are seeing slower growth rates," said Nick Leeming, chairman of estate agent Jackson-Stops & Staff.
"This follows lower levels of demand at the top end of the market, with our central London offices recording on average 2.4 prospective purchasers to every prospective seller in the last year, compared to 3.6 the year before.
"The lower demand stems from higher transaction and holding costs, such as the revisions to stamp duty, which is adversely affecting both domestic and overseas demand.
"This means that vendors in the capital who need to sell are reducing asking prices in order to do so."