Knight Frank reports London price corrections Published: 02/07/2008

House hunters looking to buy property in London will be buoyed by the news that average prices have now fallen 3.1 per cent in three months, according to Knight Frank.

The estate agent reports that the average house for sale in the most popular areas of the capital slipped 1.7 per cent in June, following a 1.5 per cent drop in May.

The combined fall is the largest since the firm's quarterly index was launched during a comfortable period of growth in 2002.

Different sectors of the prime property market in London have been hit to varying degrees, with homes worth more than £10 million showing the smallest decline.

Across the capital, the typical property for sale is still worth 7.5 per cent more than 12 months ago, but this is the lowest year-on-year increase since late 2005.

"The headline price figures hide the marked slowdown in sales volumes," observed Liam Bailey, head of residential research at Knight Frank.

"In some parts of the capital, the number of homes being sold has fallen by as much as 70 per cent over the past 12 months."

With fewer buyers on the scene, a lull in transactions and growing numbers of unsold properties, it really is a buyers' market at present.

And it is far from bleak for many homeowners in London, according to official figures from the Land Registry, as a significant number of boroughs recorded very strong growth in May.

Search for properties in London  © Copyright.