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Smaller London home-price drop shows market is stabilising

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LONDON house prices fell less than usual this month as sellers held back in a sign that the market may be stabilising, according to Rightmove.

London

LONDON house prices fell less than usual this month as sellers held back in a sign that the market may be stabilising, according to Rightmove.

Home values in greater London slipped 0.2 per cent, compared with an average 0.6 per cent drop for July over the past five years, the property website said on Monday. From a year ago, prices slid 1.7 per cent to an average £617,941 (S$1.05 million).

The UK's decision to leave the European Union has weighed on the housing market since the 2016 referendum, with London hit particularly hard. Still, low interest rates, record employment and short supply of homes are preventing a sharper decline.

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The average time taken to sell a property held steady at 67 days, a tentative sign that the market is "bottoming out", Rightmove said. The number of new sellers in the capital was down 18 per cent from a year earlier, with the scarcity of listings worst in the centre of the city.

"Owners in this area are typically able to pick and choose when to come to market, as they tend not to have a pressing need to liquidate their assets," said Rightmove director Miles Shipside.

"They have perhaps decided to spend an extended summer break at one of their other properties around the world and wait for this stabilisation of the London market to turn into a recovery."

Prices also fell 0.2 per cent nationwide, in the first monthly decline of 2019. The wait to secure a buyer is the longest at this time of the year at six years.

Brexit gloom is hitting the retail sector, with footfall down by 2.9 per cent in June, the British Retail Consortium said in a separate report. Shops in town centres were hit particularly hard, with a 4.5 per cent monthly decline, partly due to poor weather.

"Last year's Fifa World Cup (in Russia) and glorious sunshine set a high bar, which 2019's slow consumer spending and Brexit uncertainty failed to live up to," said Helen Dickinson, the chief executive of the consortium.

"High streets and shopping centres across the country need to invest in improving their consumer experience if they wish to see these footfall numbers reverse." BLOOMBERG