Coutts Private Bank is the latest institution to express its concern over London’s housing market.
The latest Courts London Prime Property Index reveals a stagnant market in which both buyers and sellers are in wait-and-see mode while Brexit negotiations play out.
It says that across the capital’s prime hotspots, sales transactions in the third quarter were down 5.5 per cent versus the second quarter, and down 15.8 per cent from the same time last year.
Over the long term, the scale of the fall is starker still with sales volumes falling by a third since 2013.
Discount rates remain high but have fallen for the third consecutive quarter, suggesting that the tide might be turning - in any case, Coutts believes better times are ahead.
Mohammad Syed, the bank’s head of asset management, says: “The end of Brexit uncertainty – when it arrives – is likely to release some pent-up demand and see a rise in market activity and prices. But we believe that it will be some time before transaction volumes return to the levels seen in 2013.”
However, Coutts warns buyers about down-valuation risks.
In a market where house prices are falling, property valuations coming in lower-than-expected are not uncommon.
George Toumbev, Coutts’ head of lending, says: “We recognise the importance of having strong relationships with valuation surveyors, which means that we can often get an indication of market value before an offer is made. In addition, it’s important to have access to a range of flexible and customised solutions.”
It adds that for buyers with a long-term view, high discounts and low competition amongst buyers mean this could be a great opportunity to buy prime property in the capital.