prime country property asking prices fall significantly in December, while prime London prices stall

The prime London sales market ends 2007 with average prices rising by just 0.1% since November and with annual price growth of 13.0%, down from a peak of 31.2% witnessed back in June. Perhaps the most surprising element of the prime property market in 2007 has been the speed with which market sentiment changed, from the record price growth and property values achieved in the height of the summer, to the struggling and increasingly cautious market currently being experienced not just in London but across the country. Many are already heralding 2008 as the year of the buyer’s market, a dramatic turnaround from the seller’s market of 2007. Prices are in decline across all areas of prime London, with the exception of the Central/South West region, where a marginal increase in average prices of 0.3% is propping up the average figure for the prime London market and keeping it in marginal positive price growth.

Meanwhile, the prime country sales market has seen the largest fall in prices recorded since the Index began back in January 2004. The drop of 1.3% in average prices since November comes on the back of three successive months of falling prices. Average annual price growth has also slowed dramatically, dropping from 10.4% in September to 6.5% by December, the fourth straight month of declining annual price growth. New instructions declined significantly in December, with the number of properties on the market up just 0.8% compared to November, the lowest rise in property volumes since February 2007.

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