Prime Index - August 2012

PRIME PROPERTY MARKET TAKES A STEP BACK FOR FIRST TIME IN FIVE MONTHS

* Average asking price for Prime property at £480,285 in July, 0.5% lower than June
* London Prime prices fell 0.2% in July to £1,338,335 but are up 16.5% over last 12m
* East London market up 1.5% in July in Olympics spotlight defying overall London trend

The UK’s most desirable homes have become slightly more affordable in recent weeks with the first drop in prices recorded since February, according to the latest Prime Property Index from PrimeLocation.com which tracks the top 25% of the UK market by asking prices.

In July, asking prices at the top end of the market fell for the first time in five months and now stand at £480,285. The average price of UK prime property is now 0.5% lower than it was in June, whist asking prices across the market as a whole fell by only 0.1% over the same period.

The gap between the prime market and overall property market, which had been rising steadily, has now narrowed for two consecutive months (by £2,256 since May), but average asking prices for Prime properties remain £257,975 more than average asking prices across the UK.

It was a mixed month for Prime properties across the UK, with price rises in five regions and drops in six others. For the first time in the past 12 months, asking prices for Prime property fell in London, by 0.18%, though the greatest reduction was in Scotland, where Prime prices fell by 1.39%.

Nigel Lewis of PrimeLocation.com says: “For the first time since February, Prime asking prices have fallen, albeit by a relatively small amount and from a record high. Despite this recent blip, some areas have performed incredibly well over the past few year. Prime properties in London are still 16.5% higher than a year ago, despite the recent drop.”

LONDON PRIME PROPERTY

Despite Prime prices falling overall in the capital, properties in East London have seen a short term boost as sellers increase their asking prices for the Olympics.

Prime asking prices in Hackney rose by a whopping 3.9% in July, more than any other area of the capital. Tower Hamlets was also in the top three boroughs, with monthly gains of 1.4%.

The average price of a Prime property in Hackney is £783,917; in Tower Hamlets it is £716,702. Commenting on the London Prime property market, Nigel Lewis continued: “London’s prime market cooled in July, as sellers dropped their asking prices for the first time in a year.

But the Olympics appear to have provided the perfect opportunity for East London owners to try to close the price gap with those in West London whilst the world’s spotlight shines on East London.”

MONTHLY PRIME PROPERTY PRICE CHANGES

Source: PrimeLocation.com (July 2012)

BEST PERFORMING LONDON BOROUGHS OVER THE PAST 12 MONTHS

Source: Primelocation.com (July 2012)