Haart estate agents reckon London is on ‘life support’ from the rest of the UK where prices and activity are recovering after the Brexit vote.
According to haart the UK is experiencing a ‘reverse ripple’ of house prices: the markets outside London are reviving which is filtering into the capital rather than the other way round.
In September market activity, meaning the number of people registering per haart branch, saw a 75% increase month-on-month in places 100 miles from London like Leicester, Ipswich and Bristol.
Places 45 miles away like Ashford in Kent, Fleet in Hampshire and Farnborough in Hampshire, saw a 37% increase – but activity only increased by 1.1% inside the M25.
Paul Smith, chief executive of haart, said: “What is clear is that since June, Britain’s property market has been turned on its head and London, for a change, is beginning to rely on the rest of the country for life-support.
“The evidence from our branches is that areas around 100 miles from the capital are where the market is reviving, and this is spreading towards the South East and London – a complete reversal of the traditional ‘London first’ pattern we’ve grown used to.
“This could be a historic realignment of our property market away from Central London, or a purely post-Brexit ‘flash in the pan’ phenomenon.”
Some haart branch agents believe that at the current rate London could be the last place in Britain to recover from Brexit.
In September London prices fell by 0.7% while transaction levels dropped by 7.4%.
The East of England is experiencing the highest levels of annual house price growth across the UK at 13.3%, with the South East close behind at 12.4%.
Smith added: “London has traditionally been seen as the crown jewel of the country’s property market, as its expanding housing bubble has grown in strength to strength in recent years.
“Typically resilient, London was the quickest to recover following in the 2008 recession. However the multitude of blows that have befallen London property market over the last couple of months are obviously proving too much to bear.
“We would like to see the government announcing measures to ease London’s suffering at this coming Autumn Statement, such as cuts to the current rate of stamp duty, as well as new and greater measures to encourage homeownership.
“It is also especially important that we see incentives put in place for London’s first-time-buyers, who are quickly becoming a generation of renters.
“With measures to ease the impact on London in place, we can hope to see the capital bounce back, and enjoy the growth that more regional parts of the country are seeing.”
After the Brexit vote the number of UK residential transactions dropped from over 60,000 in June to less than 30,000 in August.