London's once-booming property market is experiencing a significant downturn as soaring mortgage rates continue to deter potential buyers. New data reveals a sharp drop in house prices across the capital, leaving homeowners and investors grappling with uncertainty.
Why Are Prices Falling?
The Bank of England's aggressive interest rate hikes have pushed mortgage costs to their highest levels in over a decade. First-time buyers, in particular, are struggling to secure affordable financing, leading to reduced demand and falling prices.
Key Trends in the Market
- Central London hit hardest: Prime areas like Kensington and Chelsea have seen the steepest declines.
- Rentals surge: With buying out of reach, many are turning to the rental market, driving up costs.
- Investors retreat: Overseas buyers are pulling back due to economic instability.
What Experts Are Saying
Analysts predict the slump could last well into 2025 unless mortgage rates ease significantly. "This isn't just a correction—it's a fundamental shift in affordability," warns Sarah Wilkinson, a leading property economist.
What Should Buyers and Sellers Do?
For sellers, pricing competitively is now essential. Buyers, meanwhile, may find opportunities but should proceed cautiously given the volatile market conditions.
