It says something remarkable about the London property market that a 2.6% annual fall in prices is the biggest since the financial crisis.
That was, in case we have forgotten, the single worst “near extinction event” to hit the markets since the Great Crash.
And yes, prices slumped over that winter of 2008 and 2009, but they had already begun to pull out of their dive by summer 2009 after Mark Carney pressed the emergency button on interest rates, driving them down all the way to 0.5% by March that year.
And there they stayed — in fact going even lower after Brexit and in Covid — until the end of 2021. That, combined with a stamp duty holiday and government-backed schemes such as Help to Buy, sent prices soaring to levels where most London youngsters have given up hope of ever owning the roof over their heads.
It is worth remembering London prices are still double what they were after the financial crisis.
But with the low interest rate leg of support kicked away, the stamp duty holiday over, and Help to Buy ended it is hard to see what is left supporting prices at these levels.
So it seems likely we are now in for a long period of flat or gently falling prices.
But a Seventies- or Nineties-style full-blown crash? Perhaps not.
London is a far more global city now than then and the scent of any softness in prices will quickly be picked up by international investors who know a bargain when they sniff one.
The poor stewardship of the economy means they may not much like gilts any more — but the appeal of a home in Chelsea, Hampstead or Notting Hill is timeless.
