The Index reveals that the top 25% of all homes by value – or ‘prime’ properties – are now worth an average of £453,879, nearly £7,000 (£6,855) less than in September 2009. This is the biggest fall since Primelocation.com started tracking prime property prices in January 2009 and is in contrast to the average for all properties across the country, where house prices increased by 0.4% over the same period.
However, prime house prices have not been affected equally across the UK. Hardest hit was Wales, where prime properties fell by 5.8%, followed by Yorkshire & the Humber (-4.2%). Furthermore, prices in London, which has the highest concentration of prime properties in the country, fell for the first time on an annual basis since January 2009, by 1.2%. Furthermore, asking prices for ‘prime platinum’ houses – the top 10% of UK properties by value – in the capital fell by 2.8% between August and September alone.
At the other end of the spectrum, prime properties in Scotland have increased in value by 2.2% over the last 12 months while the North West, North East and South East all recorded small increases.
Commenting on the findings, Andrew Smith, research director, Primelocation.com said: “This fall in prices at the top end of the market is particularly interesting because the availability of prime stock has also decreased slightly. Usually we would expect fewer available properties to drive prices higher but at the moment they’re actually falling.
“With the rise in the value of sterling, there could be fewer high net worth individuals looking to buy property in the UK from abroad. In addition, the higher income tax level and general economic climate seems to be prompting some wealthier homebuyers to leave the UK and live in countries with more favourable tax regimes and better opportunities. Taken together these factors are contributing to falling prices for properties at the higher end of the market.”
