London house prices fall as tide turns: Large drop in Greenwich and Lewisham boroughs
One of the most comprehensive measurements of house prices shows prices begun falling last month across the country, with both monthly and annual falls seen in London.
As a whole, London prices are down 0.4 per cent on the year before and 0.3 per cent on the prior month.
The timing coincides with the end of the stamp duty cut, though it isn’t credited with being the main factor behind rising prices. The stamp duty changes did however cost the exchequer up to £4 bn.
Borough falls
Greenwich borough saw a monthly fall of 3 per cent and annual drop of 6.3 per cent.
Lewisham was down 1.3 per cent on the month and 5.1 per cent annually.
Bexley was down 0.5 per cent on the month but up 3.4 per cent on the year.
What’s also revealing is that the prevailing narrative has been high growth after the pandemic, yet the February 2020 release shows that prices in Greenwich were £475,698 on average and are now down to £449,662 on average in August 2021.
Any rise from February 2020 to the end of 2020 is now gone.
Lewisham borough numbers are all but identical in August 2021 compared to February 2020.
Acadata note that prices are rising in the most expensive areas of London, often as a result of overseas buyers.
The City of London saw monthly rises of 19.3 per cent which was a factor in holding up wider London numbers.
Dodgy money
London property has long been seen as a centre of money laundering from overseas.
As far back as 2016 a report from MPs stated £100 bn was being laundered.
Despite repeated promises from government to tighten up rules on who and how property is purchased including creating a register of owners including offshore companies, this has still yet to occur.
Donors to political parties are among those who utilise offshore companies to buy London property.
Compared to some other developed nations, taxation on overseas buyers is low as is annual property tax. Low council taxes on ultra-expensive housing ensures those on lower earnings are paying relatively high sums.
Council taxes on small flats in London can be as much as multi-million properties in neighbouring boroughs, and government policy is to shift increasing tax raising for services such as police onto council taxes.
The Acadata release is more comprehensive than Nationwide or Halifax figures due to utilising Land Registry data. They also helpfully break down data by local authority including London boroughs.
The company “uses the actual price at which every property in England and Wales was transacted, including prices for properties bought with cash, based upon the factual Land Registry data as opposed to mortgage-based prices, asking prices or prices based upon samples”.
Council tax on high cost property whether inhabited, left vacant or rented should be much higher than tax on low cost properties. Its simple. If the rules don’t reflect this then Greenwich need to pull the finger out on et another easy win and stop moaning about budget constraints for the mess is social housing, road layouts, transport and leisure facilities
There is probably some government restraint that prevents local authorities from taxing the rich more. 😡 None of those price reductions is going to help the majority of people buy a home in Greenwich or Lewisham.
Even with the cost of homes falling local hard working people are still unable to afford to buy Homes in Greenwich or South East London on their salaries.
Many people are being forced out of London to buy homes away from family and friends then have the added cost of commuting back in to London for work.