There are no properties for sale in London for £100,000 or less and only four properties at £125,000 or under, online estate agents Housesimple.com has found.
Excluding shared ownership and auction properties, houseboats and retirement homes, the cheapest property on the market today in the capital is an uninspiring studio flat in Hornchurch RM12, which the estate agent is asking for offers over £100,000.
Sam Mitchell, chief executive of online estate agents HouseSimple.com, said: “The death of the £100,000 property in London was inevitable, but with just four properties on the market at under £125,000, this will very soon be the new price floor for the capital’s property market.
“This research highlights the need for properties at the lower end of the market. Shared ownership and Help to Buy have helped people on average incomes get a foot on the ladder, but both schemes have their critics.
“It can be complicated to sell a property if you only have a small stake in it, and expensive to increase your stake, as there are additional costs to consider.
“While Help to Buy has been criticised for actually pushing up house prices and providing a vehicle for developers to inflate new build values.
“London prices cooling will help buyers, but we should be careful wishing for a Brexit slump, because even a 10-20% drop in prices could push thousands of people into negative equity and unable to move. That wouldn’t be a good outcome for anyone.”
With stamp duty rates kicking in on properties with a purchase price above £125,000, there are currently just four properties in London that are stamp duty exempt. The standard 0% stamp duty band covers properties with a purchase price of £0 up to £125,000.
However, first time buyers are exempt from paying any stamp duty on properties up to £300,000.
Over the past few months, London property prices have noticeably cooled, and many sellers are dropping their prices to attract buyers. But there is still an affordability issue in London, particularly for people on average UK wages.
Someone earning the average UK salary of £27,271, according to the Office for National Statistics, who has secured a mortgage of three times their salary, would still need a deposit of close to £20,000 to even be able to afford the property in Hornchurch.
And that’s assuming the seller would accept an offer of £100,000.
Flexible hours. Work from home. Be your own boss. WATCH THIS VIDEO NOW.