London house prices are down overall, but some areas are bucking the trend. Is it time to bag a bargain in the capital?

London house prices have dropped by 0.3% compared to this time last year, according to the latest figures from property website Zoopla. That means the average London property will now set you back £536,000.

If you’re looking for a bargain, buyers are currently paying around £27,000 less than the asking price. That’s a discount of 4% with buyers achieving 96% of their asking price on average.

What’s causing the London dip?

The experts at Zoopla say that high interest rates are to blame for London’s sluggish property market. This is having a bigger impact in the capital, where the average house price is double the national average.

Across the UK as a whole, house prices are actually going up! The average UK house price edged up by 0.1% and could rise by as much as 2% by the end of the year.

Good news for Lewisham, Greenwich and Merton

It’s not all doom and gloom if you’re looking to buy in London. While most areas are seeing small price drops, Zoopla’s Richard Donnell has identified some bright spots.

“Prices are actually rising in more affordable parts of inner London,” he reveals, “like Lewisham (up 0.8%), Greenwich (up 0.6%) and Merton (up 0.5%).”

Is now the time to buy?

Zoopla’s Richard Donnell thinks the London market will start to pick up soon. “We expect housing sales to continue to grow in London,” he predicts, “While house price inflation is set to move into positive territory this autumn, we expect price growth to remain in low single digits for the next 12-18 months.”

Estate agents Chestertons are also seeing signs of life in the London market. “We have seen an uplift in the number of buyers making an offer in July,” says Sales Director Gary Howorth.

He puts the increase down to two things; buyers feeling more confident after the General Election, and homeowners rushing to sell before a potential rise in Capital Gains Tax.