London house prices: Covid causes property prices in prime spots to tumble by 40%

Property prices in England’s capital could be about to plummet as house prices in some top locations begin to tumble. New research by international experts on real estate, residency and citizenship Astons has found that London’s high-end market has seen house prices fall. The company looked at London’s ten most high-end prime property postcodes and compared the average sold price in January last year to the average sold price seen in the previous year before the pandemic.

At the start of the pandemic, the property market was put on pause like a plethora of other industries in the UK.

London house prices have crept up by three percent during the coronavirus pandemic, despite initial instability.

While London as a whole has seen prices climb, sold prices across some of the city’s most sought-after locations have sunk.

According to research by Astons, sold prices have fallen by ten percent since the start of the pandemic in some of London’s prime postcodes.

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However, there are other postcodes in London’s prime locations that are enjoying a price boost.

SW3 and SW10 in Chelsea are seeing prices increase by 23 percent and 12 percent respectively.

W1K and SW7 postcodes have also enjoyed an increase in pandemic sold prices with increases of six percent and three percent respectively.

Meanwhile, research by national estate agent Keller Williams UK has found that London’s rental prices are declining.

The company looked at rental price changes between 2020 and 2019 with Covid causing a marginal reduction in rents.

The average cost per month has actually fallen by 0.8 percent in London, a welcome decline for tenants who are paying on average £1,639 each month, according to the Office of National Statistics (ONS).

Rental prices have fallen by 3.4 percent in the capital which amounts to around £58.

Managing Director of Astons, Arthur Sarkisian, said the UK property market has been “firm” despite the coronavirus pandemic and has “accelerated” since it reopened in the summer.

However, Mr Sarkisian said some of London’s most sought-after postcodes have seen prices fall since the beginning of last year.

He continued: “This decline in property prices has been due to a number of factors.

“While nice, the stamp duty holiday saving hasn’t boosted buyer demand amongst high-end homebuyers to the same extent as it has in the regular market.

“Restrictions on travel have also prevented foreign investment to a certain extent while those looking to buy for themselves have continued to opt for more peripheral locations such as Hampstead.”

However, Mr Sarkisian said there is a “silver lining” which is prime London spots now being more appealing due to their lower price point.

He added: “The current landscape not only offers a saving where property prices are concerned but also in terms of the soon to be implemented stamp duty increase for foreign buyers as of April this year.

“With much of prime central London holding its value and demand starting to return, it won’t be long before the current areas offering an attractive investment proposition start to see property prices climb once again.”

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