Tuesday, 1 May 2012 11:27 AM
London house prices fell 1.8 per cent in March in a significant reversal of recent trends, according to the Land Registry.
After several months that have seen prices in the capital rising significantly ahead of the rest of the country, London saw the second biggest decline over the month after Wales (-4.1 per cent). Prices also fell in the South West (-1.0 per cent) and the South West (-0.7 per cent).
In contrast prices in the North East, one of the regions that has seen some of the biggest falls recently, rose 5.6 per cent in March. It was joined in positive territory for the month by the East and West Midlands and Yorkshire & the Humber.
The average price of a home in England and Wales as a whole rose 0.6 per cent to £160,372.
The regional trends are confirmed in the figures for individual local authority areas. The biggest falls over the last year have come in Hartlepool in the North East (-13.8 per cent) and Ceredigon in Wales (-11.8 per cent) whereas Westminster (+12.8 per cent) and Kensington & Chelsea (+10.8 per cent) have seen the biggest increases.
Looking back over the last year, prices are still down 0.6 per cent. Prices in London have risen the most (0.7 per cent) and they are also up slightly in the East and West Midlands and the East. Wales (-5.5 per cent), the North East (-2.8 per cent) and Yorkshire & the Humber (-2.2 per cent) have seen the biggest falls.
The most recent Land Registry data for transactions shows that 42,511 homes were sold in January, an increase of 13 per cent on January 2011.
However, most of the increases came in properties of under £400,000. Sales of properties worth over £1m fell from 497 to 467.
Nicholas Leeming, business development director at Zoopla.co.uk, said: "A number of London’s sellers decided to drop prices in February and March in order to keep buyers interested as the prospect grew of either a mansion tax or a new stamp duty threshold being announced in the budget.
"As a result, the month-on-month fall in average prices in London is likely to be a temporary blip, however, the fall will put pressure on annual price growth in London over the coming months. The overall trend of average price falls demonstrates there is still some nervousness among buyers and this is putting downward pressure on prices.
"Confidence will need to be shared among buyers and activity levels will need to rise if we’re to see consistent growth in average prices this year, however, the fact remains that for buyers with healthy deposits and who fit current lending criteria, now is a good time to pick up a bargain."