House sales in Prime Central London have slumped to their lowest on record with Brexit and high taxes to blame, it has been claimed.
Figures from London Central Portfolio show annual transactions in Westminster and Kensington and Chelsea have fallen to 3,606 – fewer than 70 sales per week.
This is a decline of 16.8 per cent over the year and is 2.7 per cent less than the previous low of 3,704 seen during the Global Financial Crisis in June 2009.
Sales are down by a staggering 45 per cent on 2014, according to the latest LCPAca Residential Index, with new-build sales static over the past 12 months.
But despite the slump in sales, the annual price in Prime Central London currently stands at £1,866,517, representing annual growth of almost five per cent.
Naomi Heaton, CEO of LCP, said: “It is hard to see how this decline in transactions can be reversed until there is an agreed outline plan for Brexit.
“International buyers, already affected by successive tax increases and now exposed to negative coverage of the current political situation, are holding back.
“Nevertheless, the high value sector is seeing a better performance now.
“The weakness of sterling and the high absolute levels of discounts available are encouraging homeowners, in particular, to enter the market.”
In Greater London, annual transactions have fallen 7.6 per cent to 87,358, due to higher taxes and continued uncertainty.
These falls have been seen across Greater London with new build transactions falling 13.6 per cent over the year.
New build prices currently stand at £791,455 in Greater London, a 31.1 per cent premium over existing stock.
Ms Heaton added: “This is now a very familiar picture across the capital. Market sentiment has not been restored by the government’s policies or handling of the Brexit negotiations.
“In what is already a heavily taxed landscape the government believes there is still room to add further taxes directed at the overseas investor.
“This does not seem to be the right message for the government to be sending to the outside world with Brexit looming.”
Transaction levels are now having a major effect on the capital’s estate agents, according to the LCPAca Residential Index.
The report points out that Foxtons reported a first half year loss and vacated their most prominent central London office on Park Lane. Meanwhile, Countrywide’s mid-year share price fell almost 30 per cent, after a further profit warning.
Crest Nicholson, the upmarket housebuilder which specialises in London and the South of England, warned last week that profits will be lower than expected due to political and economic uncertainties.
Sales in England and Wales have also fallen, but not at the same rate as those in Prime Central London and Greater London.
Figures from London Central Portfolio show 779,638 annual transactions outside Greater London, a drop of 3.2 per cent.
House price growth has been slowing since 2014, with average price growth in England and Wales falling from 5.7 per cent to 2.4 per cent currently. The average home currently costs £266,993.
