Lottie Bodilly has just bought her first home. After months of searching, the 25-year-old, together with her partner, Jackson, has found a large two-bedroom apartment in a Victorian building in Streatham, south-west London. The couple completed last Friday. The price: just under £500,000. “The vendors had a lot of interest and we had to go to sealed bids,” says Bodilly, a web publishing entrepreneur. “We moved quicker than we would have liked because the market was a little sparse and we were nervous about how many more homes were going to come up for sale. But we liked it,” she says, “so we went for it.”
If Bodilly had waited, would she have got a better deal? The property market in London is in turmoil. In the first three months of this year, prices were down 4 per cent on the first quarter of 2018, according to Nationwide, and 5 per cent down on their peak the year before. In January, the number of homes sold fell to its lowest in a decade. Last week, shares in Foxtons, the London-focused estate agency, were trading at about 53p, down 87 per cent since their peak in 2014. All this with Brexit unresolved, and a no-deal exit on 31 October still possible. If that were to happen, house prices could drop 30 per cent in the next three years, according to the Bank of England stress test’s worst-case scenario. But Bodilly is undeterred. “Neither of us are particularly concerned about Brexit,” she says. “This is our first house and we’ll probably be here for three to five years at least, so we were more concerned that we wanted to buy in an area that was going to come up.”
Many property agents and experts agree with her. They say early indicators suggest the slump in London’s housing market may be about to end. This, of course, is exactly the kind of thing estate agents like to say, so how can we be sure? The answer depends on your circumstances, but let us look at the evidence to help you decide whether to make a move — or wait it out: Terraced houses in Streatham, south London What the data show The seasonal nature of the housing market makes spotting short-term trends difficult, and the recent fall in transactions makes it even harder. Still, there is some evidence the market in London could be about to turn. The proportion of London homes with falling values peaked last autumn at about 80 per cent, according to Zoopla, the online property portal. By the beginning of 2019, that proportion had fallen to 68 per cent. The proportion of homes showing monthly falls has dropped below 30 per cent for the first time in two years.