Hobbies and Interests


eg: UK or Brides UK or Classical Art or Buy Music or Spirituality

Business & Money

Technology

Women

Health

Education

Family

Travel

Cars

Entertainment

London Property Prices Are About To Come Down

View:

The property industry has been expecting a fall in rising house prices for some time, but it's still a jolt when it finally arrives. In October house prices have fallen across the UK for the first time in two years. Rising interest rates, rising mortgage fees and the squeeze on credit are all finally taking their toll.

The London mortgage market outlook is looking fairly bleak as it appears that those who are well off are losing confidence in property as an investment vehicle. City bonuses have seen a sharp downturn which could affect prices of property in prime London. There could also be a knock-on effect on commuter areas and second home locations such as the South West, East Anglia and the Cotswolds.

Many homeowners have been banking on ever-rising prices to increase their home values which many regard as an investment in itself, to help fund their old age.

Up-market property agent Savills has forecast that there will be a 60% fall to ?2bn in the amount of money flowing into prime London property and second and third homes. Central London, it says, will see at least six months of falling prices. This follows a boom in London that has outlasted nearly every other UK region, most of which have seen falls in recent months.

The London market also received a blow recently when the International Monetary Fund said that Britain's housing market was overvalued by up to 40%. In October house prices slipped back by 0.1% following two months of stagnation.

A new warning has come from the US, that Britain will not escape the fallout from the recession in US property. Robert Shiller, Professor of Economics at Yale University, forecast the end of the dot.com bubble in March 2000, and he says the property slowdown in the UK will start in London.

Savills agreed that the top end of the property ladder and the second-home market could be hit hardest because high earners are beginning to look elsewhere for their investments as they no longer see property as a good buy.

The Centre for Economics and Business Research has suggested that the housing market would shrug off the difficulties within a year and that by 2010 annual growth would be back at up to 7% because of an imbalance of supply and demand.

The pressure on financial instituions resulting from the credit crunch has meant that mortgage interest rates have been going up, and fees too, even without a rise in the Bank of England's base rate since July. Finding a mortgage in London is tough, and consumers are well-advised to shop around.

Meanwhile, a recent study for the Channel 4 programme Location, Location, Location has named five London Boroughs among its worst places to live in the UK ? and none in the top twenty best places to live. Six criteria were used to rate each borough: crime, education, environment, lifestyle, health and employment. These were weighted and used to judge a place's desirability based on what would be most important to people if they moved home.

Related Articles
Author
Most Popular

Nick has sinced written about articles on various topics from Finances, Writing and Cars. A writer on property articles outlining the current climate of the property market. Offering knowledge of a number of key areas in the property sector.. Nick's top article generates over 74000 views. to your Favourites.

Bes The Egyptian God
In the Ogdoad cosmogony myth, Djehuty gave birth to Ra, Atum, Nefertum, and Khepri by laying an egg while in the form of an ibis, or later as a goose laying a golden egg