London house price crash?

31st May 2007 - Rumours that the London house price boom could be finally over have been appearing in a number of papers. Citing data from the Land Registry, it appears that house prices in 9 areas of London fell for the first time in 11 years, prompting fears that the property boom could finally be at an end.
 
This could spell very bad news from house owners, as interest rates have increase mortgage burdens in recent years, and falling house prices could prevent many from selling their homes, bringing back memories of the negative equity trap that many experienced in the early 90's.
 
It is however worth bearing in mind that London house prices have risen very sharply in the last few years, and this could represent the market stabilising itself. Whatever the outcome you can be sure that a number of nervous property speculators and buy to let specialists will be monitoring the situation very carefully.

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