House prices in London since the Brexit vote five years ago this month have slowed to such an extent that homeowners across the capital have actually lost value in their properties against inflation.
According to Land Registry figures, in June 2016 the average price of a home in London stood at an all-time high of £468,120, having added more than £100,000 over little more than two years.
Back then, Croydon was the fourth least expensive place to buy among London’s 32 boroughs and the City, with an average house price of £325,000.
But Croydon was the third busiest borough for house sale transactions, with 5,705 properties changing hands in the three months from March 2016. Only Wandsworth and Bromley kept their borough’s estate agents busier at that time.
Now, though, the average value of a home in London is £491,687, an increase of just 5 per cent over the whole period. A 1 per cent per year increase is regarded as “glacial by London standards”, according to the Evening Standard’s weekly homage to the city’s estate agents.
According to RightMove, the average house price in Croydon in 2020 was £398,500 – 22per cent higher than in 2016, representing an increase of 5.6 per cent per year.
That’s good news for those who have moved to Croydon rather than other parts of London in that time, because since June 2016, inflation has averaged 2 per cent, meaning that for the majority of Londoners, the value of their homes has gone down in value in real terms.
Land Registry data is regarded by property analysts and economists as particularly reliable because, while its quarterly figures lag behind the breathless barometers of the housing market from estate agents and websites, it is always based on the hard data of actual completed transactions.
The Brexit effect on the London-wide market appears to have really kicked in in 2017, the result of depressed foreign investment and fears about future levels of employment. Since the Brexit vote, several large European banking and commercial businesses have decided to move their offices out of London.
The London market reached a peak with the average price of a London home hitting £502,195 in January this year, but as reported last week, house prices have begun to slip back since. The London property market suffered its biggest monthly fall in a decade in April. The coronavirus pandemic has forced many to consider moving out of central London, seeking larger homes with garden space in the suburbs and country.
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