Knight Frank slashes is forecast for Prime central London house price growth

 
Emma Haslett
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Growth in the price of luxury homes, such as the ones at One Hyde Park, is slowing down (Source: Getty)

An upmarket estate agent has become one of the first to admit rapid growth in the price of the capital's luxury homes might be beginning to ebb, after it slashed its forecast for house price growth in London's most exclusive areas.

Knight Frank said today it had revised its growth expectations for 2016 from 4.5 per cent to two per cent, adding the top end of London's property market had "faced a number of headwinds in 2015, which reduced annual price growth from five per cent at the end of last year to 1.3 per cent in September".

Read more: Stamp Duty has hit the prices of the capital's most exclusive properties

It's not wrong: in recent months the sector has been hit by the double-whammy of punishing increases to Stamp Duty on homes at the top end of the market, as well as a sudden drop in interest from China, an economy it has increasingly begun to rely on, whose growth has been dented in recent months.

Still: Liam Bailey, Knight Frank's global head of research, maintained an optimistic outlook.

"The strength of the UK’s economic recovery, employment growth in London and the likelihood of continued low interest rates mean price growth will remain positive next year."

The news comes after figures from Halifax earlier this week suggested UK house prices fell 0.9 per cent between August and September - their biggest monthly fall in a year.

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