House prices in the capital fell by 4.4% in the year to May, according to the official UK House Price Index from the Office for National Statistics.

This was a further drop from the fall of 1.7% in London in April and the worst performance of any region in the UK.

Jonathan Hopper, managing director of Garrington Property Finders, said: “Such a punishing drop in London house prices is a reminder that the capital’s correction is still underway. Above all, it suggests the modest slide in the year to April, rather than the breathtaking fall that followed it, may have been the blip.

“The scale of London’s fall – the largest seen since the recessionary plunge of almost a decade ago – is also a reminder of the definitive shift in the dynamic in the capital. Buyers are now setting the tempo, dictating terms in price negotiations and frequently able to secure additional discounts on properties that are already reduced.”

The North East also recorded a fall in the year to May, of 0.7%.

High risers

House price growth in England was strongest in the North West, where prices increased by 3.4% in the year to May 2019, up from 3.3% in the year to April 2019. However, in Northern Ireland a 3.5% annual rise was recorded.

Overall, UK house price were up by 1.2% in the year to May 2019, a small fall from the 1.5% in the year to April 2019. The average price of a property in May was £229,431, 0.1% higher than in April.

Hopper added: “Three English regions are now enjoying an annual pace of growth approaching, or above, 3%.

“Such decent growth cannot be dismissed as a mere byproduct of scarce supply. It’s also a testament to solid buyer demand, and the willingness of would-be buyers to get off the fence now they detect strong value.

“With the best performing regions balancing out London’s weakness to a degree, the fear now is that the delicate equilibrium could be upset if the country marches closer to a ‘no-deal’ Brexit in October.”