The boom in London house prices will not only end next year, but could even fall, according to the Centre for Economics and Business Research (CEBR).
Their own forecast puts the decline at 2.6 per cent for 2015, which would be the first annual fall since 2009.
House prices in the capital are expected to grow 17.1 per cent this year, but there are signs the market will slow dramatically in 2015, says the CEBR. Falling new buyer enquiries and longer selling times are pointing to a slowdown.
Compounding this is a decline in overseas demand caused by a stong pound, making the UK more expensive. Stricter lending rules from April are also likely to curb demand for housing, the CEBR say.
“The price falls forecast for next year will be modest and we shouldn’t be too worried about this – we are not anticipating a crash. The market is adjusting after getting ahead of itself at the start of 2014,” said Scott Corfe of the CEBR.