The primary real estate markets in London witnessed a moderation in the rate of price declines during the last quarter of 2023, reflecting a resurgence of confidence in the market. Factors such as decelerating inflation and reduced mortgage rates have played a role in this trend.
The source of financing for buyers has emerged as a critical factor influencing the performance of various market segments. Prime central London exhibited the most modest decline in property values throughout 2023, registering a decrease of -0.8%, with a marginal drop of -0.2% observed during Q4.
In the outer prime London markets, which are more reliant on mortgages, prices saw a decrease of -0.3% in the final quarter, marking an improvement from the -0.8% decline recorded in Q3 and resulting in a year-on-year decrease of -1.2%.
These statistics indicate a market that has likely surpassed its period of maximum decline, as the rate of price decreases continues to stabilize. However, despite growing optimism, the majority of Savills London agents (79%) anticipate an increase in available properties over the next three months. Thus, maintaining realistic pricing expectations among sellers will remain crucial in the foreseeable future.
Data from: Savills