Prices on London’s high-end property market have increased by just 1.7 percent since August 2014, the sector’s slowest growth rate in more than five years, according to statistics released by Knight Frank. Meanwhile, in some of the city’s more exclusive neighborhoods, prices have even fallen. In Notting Hill, for example, prices have dropped by 4.6 percent on average over the last 12 months, while Knightsbridge property prices have fallen by 2.4 percent. However, in some areas, like the City of London, prices have shot up by 7.1 percent.
Knight Frank suggests that buyers are “coming to terms with higher stamp duty and uncertainty in global financial markets,” especially China’s decision to devalue its currency. The higher stamp duty on homes, introduced last December, pushed up prices and slowed home sales in prime areas by 48 percent between January and April. Sales picked up briefly following the May general election, but were still down by 20 percent y-o-y, according to Knight Frank.
“The seasonal nature of the market dictates that buyers will become more active in the autumn and a greater sense of normality will return to the market, which will also be driven by the fact vendors are lining up new properties for sale,” said Tom Bill, head of London residential research at Knight Frank.
