London property market will lead the way to recovery
January 13, 2009
Recent reports have suggested that whilst London may see the largest house price falls than any other area in the UK next year property prices in this area will also be the first to recover once the housing slump starts to subside.
Officials claim that London will recover both sooner and faster than other parts of the UK. However, one industry group has predicted that in 2009 house prices in Greater London will fall by 15-17 percent and in the city itself by around 16-20 percent.
These grim figures compare to predicted falls of around 13-15 percent in other parts of Britain, with the predicted figures coming from the property giant Lang LaSalle (JLL). Officials have said that the many job losses in the financial sectors in the city, coupled with the loss of bonus payments for city officials, have seen demand for housing fall and this is set to drive down property prices at a faster pace than elsewhere.
Neil Chegwidden, JLL’s head of residential research, stated: ‘Clearly, and understandably, London is bearing the brunt of the financial crisis. ‘London’s economy, the financial and property sectors, and the jobs market have been hardest hit.’
The firm said that there had already been house price falls of around 15-20 percent in London this year, and further falls could see tens of thousands of pounds more wiped off average property prices and values over the coming year.
Chegwidden said: ‘London is likely to lead the housing recovery, which will be gathering pace during 2011 and is likely to be boosted in the run-up to the 2012 Olympics. The medium-to-long term outlook for UK house prices is very positive. Not least of the reasons behind our conviction is that the much publicised gap between demand and supply is not only already significant, but that this divide will undoubtedly widen over the next few years.’
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