Hampstead property prices plummet in May

House prices in Hampstead have fallen almost 10 per cent

House prices in Hampstead have fallen almost 10 per cent - Credit: PA Archive/Press Association Images

Hampstead homeowners are seeing their house prices slashed by almost 10 per cent since last year, according to new figures.

Property prices in NW3 dropped 9.2 per cent year on year to £1,051,454 research from estate agent Stirling Ackroyd found.

A combination of Brexit jitters, political uncertainty, changes to stamp duty and taxation for international buyers have all contributed to a dampening of activity at the top of the market, with investors unwilling to gamble in the new high end property climate the report said.

Andrew Bridges, managing director of Stirling Ackroyd, comments, “Posh no longer means profitable – or at least you can no longer presume so. London’s hugely diverse property market is undergoing a serious readjustment, with the traditional old heart of ‘prime’ London under pressure from many fronts – from a low global oil price and China’s economic slowdown, to stamp duty reform and international fears of Brexit.

“London’s luxury postcodes are far from invincible, and while these areas will probably rebound in time, the latest blip should act as a healthy reality check – to dispel any assumptions about the top London locations for rising house prices. Cities shift – and as London grows and evolves, the capital will never be static.”

Falling house prices were not confined to Hampstead alone, with asking prices in the whole borough of Camden dropping 4.4 per cent to £1,099,702 this month compared to April 2016, following a surge in buyer activity at the start of the year.

The website said that that stretched affordability among first time buyers in inner London was also now acting as a drag on the market as well as top of the ladder purchasers.

Miles Shipside, Rightmove director and housing market analyst said: “Whilst Inner London and the central boroughs in particular are mainly highly-priced locations, they also had large pockets of lower-priced housing, typically the target of first-time buyers.

“Research by Rightmove shows that none of these locations are experiencing high enough price rises to make it into the national top ten hotspots for first-time-buyer type properties with two bedrooms or fewer. All ten are in either outer London or the neighbouring regions.

“This indicates an exodus of first time buyer interest as they are driven out of inner London by the sheer unaffordability of properties in that area.”

This supports Stirling Ackroyd’s findings that, in contrast to the top 25 per cent of London’s property market, the remaining areas of the capital saw price growth of 8.2 per cent, a blow for aspiring first time buyers.

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Tottenham postcode N17 was among the top areas driving house price growth in London, with prices rising 21.3 per cent since last year, after a wave of new development in the area.

“Old heroes such as Kensington and Hampstead are all feeling the housing market heat, but these places are not the norm. Negative house price growth in certain districts is hiding a more positive picture,” said Mr Bridges.

“Overall, London’s housing market is strong and shows no sign of easing up or losing momentum. Later this year, establishment figures of the property landscape might regain their strength; it may be a simple case of post-June investment rises. Or it might be that underlying demand is changing course – and heading to fresh parts of the capital.”