London house prices fall again as property slowdown drags on

London house prices fell again in May, dropping 3.7% year-on-year to an average of £545,000, according to the Office for National Statistics. The decline is attributed to uncertainty over Prime Minister Andy Burnham's premiership, which has dampened market confidence. Wealthy neighborhoods suffered the most, with prices plummeting 22.8% in Westminster and 10.7% in Kensington and Chelsea. Property experts note that high property values in London drag more buyers into paying stamp duty, with four in five first-time buyers in the capital paying the tax compared to one in ten in Northern England. Additionally, the spike in mortgage rates caused by the Iran war has hit London buyers harder due to their need for larger mortgages. Buyer enquiries are down 20% and agreed sales down 7% compared to last year, with the summer heatwave and World Cup also cited as distractions. Activity is expected to pick up in autumn after Burnham's first Budget.