Hc has her house on the market, and can't sell, I believe.
There are lots of areas in east london particularly that became popular during the boom because people couldn't afford the smarter areas. If/when prices fall, these areas are going to be particularly badly hit because the few buyers there are will be able to choose from a much wider range of houses in more established areas.
I think London shows the very extremes of the market and some places/sectors will suffer more than others and, I'm afraid, east London being one of the areas many people moved to because they couldn't afford Islington/Camden is quite vulnerable. Unless you have a really great neighbourhood (chi-chi bit around Victoria Park or Columbia Road, for example) I think it is going to go belly up just as badly, if not worse, than many places in provinces because so much of the new development was very, very speculative.
I think it also depends on the type of property - think older properties in all areas of London will fall but not as badly as the new builds, houses maybe will hold better than flats. I think how hard people will be hit also depends on how recently or otherwise they bought, I worry for anyone who bought in the last 2 or 3 years because those kind of hikes just seemed insane. And it depends on the area too - I think places which are more attractive and/or have good transport links, parks etc will weather the price crash better.
I had estate agents around this morning and they said that prices in London aren't falling anywhere like as fast as in some other parts of the country (and that prices aren't really falling too badly anywhere!). This was SW London rather than E though.
Maybe though I don't see how it benefits them really. It makes sense to me that house prices would fall slower here because people are always going to want to move here (the fools! ) but tbh I don't think anyone really knows.
I have been living in East London since the 1990s and seen quite a few things happening. There was a readjustment in 2005 but then prices went up again. Prices have come down a bit this year. People who don't need to sell are staying put so not so many nice houses for sale, lots of 'dogs' and ex rentals. So many reductions happen because the houses are not that good, but there are still people overpaying for big, nice houses. We monitor the local market carefully through houseprices.co.uk There will be a further reduction in autumn and winter but this happens every year here, even in rising market the winter has always been a cheaper period to buy. Part of the East London area is in a flux because of the Olympics in 2012 and also we have had a really big migration from Eastern Europe happening (incidentally, the people who bought my previous house were East European). There is demand for housing as it's cheaper for families to buy here rather than other parts of London. The thing I noticed is that since 2005 asking prices have been inflated as people got into the habit of offering 5-10 per cent off the asking price even if there was nothing wrong with the house. Some estate agents are honest about it, ours told us the market was not that dynamic and advised us not to put a huge asking price, we followed the advice and sold in two weeks and very close to asking price. House was spotless (completely redecorated). I'm only worried about the buyer's lower chain, but the sale is going through at the moment. It's hard to predict what will happen in London, lots of people come to London or are stuck here for various reasons, as I used to be.
I agree with all those who said London is going down and the less desirable/less trad/most recent to rise areas will be hit the hardest. That's the way it was last time it's going to be worse this time by all accounts. I expect I'm closer to anglepoise than you and I'm looking for 30-50% off. Is hc hoxtonchick? is she still trying to sell her house? (was wondering what had happened and didn't like to ask)
We've lived in East London (zone four) since 1999. I would say this but I'm confident prices will be okay. I feel like London's centre of gravity, so to speak, is shifting eastward, with more jobs moving to Canary Wharf (20 min from us) in a variety of sectors. We are also very commutable to Liverpool Street station on the central line. Really good schools (state and private), plus access to green areas. There have been big changes on our high street (and neighboring ones) since 1999, all for the better. Lots of structural reasons why east london will still be popular. I really feel that in fact, the differential between parts of west London and east London is still too great, and will improve in our favour.
I live in east london. From what I can see the older terraced housed - brick ones with pitched rooves and gardens - sell. Flats don't, especially new builds, especially around the Wahrf, and the developments along the river in woolwich / newham.