House prices plunge 3% in London's top areas

Property prices in London's most sought after areas have plunged by more than three per cent in three months, figures show today.

Prices in central London and affluent suburbs fell 1.7 per cent last month, following a 1.5 per cent fall in May, according to agents Knight Frank.

The figures represent the largest recorded quarterly fall since the firm began analysing property price movements in 2002.

Worst hit were properties worth less than £1million, where buyers tend to be dependent on mortgage finance.

Prices of "super-prime properties", costing £10million or more, only fell 0.9 per cent last month.

Overall, prices are 7.5 per cent higher than a year ago, the lowest year-on-year increase since November 2005. The volume of sales fell by around 60 per cent.

The figures cover areas including Mayfair, St John's Wood, Regent's Park, Kensington, Notting Hill, Chelsea, Knightsbridge, Belgravia and the South Bank, Canary Wharf, Hampstead, Richmond, Wandsworth, Wapping and Wimbledon.

Liam Bailey, head of residential research at Knight Frank, said: "The fall in prices that began in May has intensified during June, demonstrating that there can be no doubt that even the top property areas have been hit by the double whammy of the credit crunch and wider concerns over the global economy."

The number of homes being sold had fallen by up to 70 per cent in some areas over the past year, he said.