London housing slump to survive for some time - Bloomberg

As reported by Bloomberg, the UK's housing price contraction is making a measurable bump in future prices to come.

Key quotes

"Official numbers show that prices in the capital only started to fall this year. But it feels much more brutal to real-estate agents on the ground. James Hyman, head of the residential agency division at Cluttons, has been in the business for two decades and knows how to read the signs. The market is already down about 15 percent in central London compared with four years ago and, in his view, it may fall another 7 percent in the next year and half.

For its part, Brexit has put off overseas buyers, reducing demand by as much as 70 percent from 2014 levels, according to Hyman. “Brexit was the absolute final reason why the property market in London would come to a slide down,” he said in an interview. “This is about affordability.”

To help people get on the property ladder, the government tried to crack down on equity-rich homeowners buying up property to rent out. It increased sales tax on second-home purchases and changed the tax relief for mortgage interest on rental homes.

The picture in the capital varies widely in different neighborhoods. A report from LSL Property Services and Acadata last week showed prices fell in 21 of 33 boroughs from a year earlier in August, with Tower Hamlets seeing a near 10 percent drop and Greenwich, Westminster and Wandsworth seeing falls of around 9 percent."