London house prices: property market drops for the 18th month in a row wiping £7,000 off average home in the capital

London house prices have fallen for the 18th month in a row, wiping nearly £7,000 off the value of the average home in the capital.

The property market dipped by 1.4 per cent in the year to August, leaving the average price at £472,753, according to Land Registry figures.

Prices are nearly £3,000 below where they stood in July 2016, the month after the EU referendum. In September 2017, they peaked at £488,527.

House prices fell in 21 of London’s 33 local authority areas, with the biggest drops in Kensington & Chelsea (down 9.1 per cent) and Brent (8.7 per cent lower).

They were down one per cent in inner London and 1.7 per cent in outer London.

The fastest-rising prices were in Hackney, where they went up 5.4 per cent, and Lewisham, which recorded a 3.9 per cent rise.

Jonathan Hopper, managing director of buying agency Garrington Property Finders, said: “While the capital still has the unwanted honour of being the region where prices are falling fastest, prices in the inner boroughs are beginning to settle and historically this is often seen as a precursor to a wider recovery across London.”

On the high street prices rose 1.7 per cent in September, according to the headline measure of inflation, the Consumer Prices Index. This was unchanged on August.

Howard Archer, chief economic advisor to City forecasters EY ITEM Club, said: “If the UK leaves the EU without a deal we believe house prices could quickly sink and drop around five per cent.”

It came as sliding fuel and second-hand car prices kept UK inflation at its lowest for almost three years in September.

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