“The damage done across the prime market, in particular, has been far more pronounced, although the silver lining is, of course, that there’s never been a better time to buy at the very high-end of the London housing market”
– Marc von Grundherr – Benham and Reeves
The latest research by London lettings and estate agent, Benham and Reeves, has revealed London’s six best-performing boroughs when it comes to positive property price growth, having bucked the wider trend of house price depreciation that has blighted the capital over the last year.
Benham and Reeves analysed the latest Land Registry data for December 2023, hot off the press last week, which provides a full look at how the London housing market has performed over the last year.
Much like the wider UK market, it was a challenging year for London property, with higher mortgage rates stifling buyer demand, causing house prices to cool from the record highs seen during the pandemic market boom.
As a result, the average London house price fell by -5.2 % between January and December last year, finishing 2023 at an average of £508,037 – the largest decline of all UK regions.
This decline was predictably at its most prominent across London’s more expensive prime boroughs, with the City of Westminster recording a 20.9% reduction in the average house price throughout 2023 – a drop of £232,015
In Kensington and Chelsea, the average house price fell by -17.4% (-£236,346), while the City of London saw reductions to the tune of -16.6% (-£160,221) and in Hammersmith and Fulham house prices fell by -13.2% (-£101,522).
No less than 27 London boroughs saw a reduction in the average house price throughout 2023 – City of London included. But six did buck the wider trend of declining house prices to record positive movement.
Both Hackney and Lewisham saw marginal increases of 0.7%, along with Islington at 0.8%.
Newham saw a 1.1% increase in the average house price, while in Camden they climbed by 1.6%.
However, it’s Richmond that has enjoyed the largest boost to house prices, up 2% year on year.
Director of Benham and Reeves, Marc von Grundherr, commented: “With house prices cooling during the later stages of last year, it’s the London market that has naturally been hit the hardest given the far higher cost of homeownership, with all but a handful of boroughs experiencing a decline.
“Largely speaking, this decline has been marginal in the grand scheme of things and the vast majority of boroughs have only seen slight corrections, with house prices remaining there or thereabouts when compared to the record peaks seen during the pandemic market boom.
“However, the damage done across the prime market, in particular, has been far more pronounced, although the silver lining is, of course, that there’s never been a better time to buy at the very high-end of the London housing market.
“But rest assured that when the London market does turn, it turns quickly and with interest rates now falling, it’s only a matter of time before the sleeping giant of the UK property market awakens. When it does, we expect London property prices to not only rebound but to once again lead the rest of the UK with respect to the rate of growth seen.”
