Cooling market but London still in demand

Signs of cooling in the housing market have been identified by RICS, but the exorbitant costs of the London market remain largely untouched.

Sentiment in the market continued to deteriorate, according to the property association's latest housing market survey out today, but the capital's climate continues to prove resilient to the wider downturn.

London prices have begun to cool their rate of growth, but the high-end demand in the capital and the steady influx of investment means that the property market as a whole continues to prove difficult for first-time buyers.

New buyer enquiries in London declined for the 14th consecutive month, suggesting that many are stepping back from the market.

For many Estate Agents, the signs are that London is experiencing a slowdown in the context of the last decade's phenomenal growth, but for others, however, demand remains strong.

Kevin Ryan, a representative of Carter Jonas in the Mayfair-Westminster area, was one who felt activity was continuing.

"New instructions are growing," he said as part of RICS' commentary notes. "If the point comes, for the first time in many years, where there are more properties than purchasers, then we will see a buyers market and an inevitable fall in prices.

"However, at present there is no evidence of values reducing."

Londoners have increasingly turned to rental options in light of the difficulty getting on to the property ladder in the capital - something which shows no signs of abating.

Published 11th March, 2008

© 2008 Estates IT Limited