London property prices are 'off the boil'

Asking prices have come "off the boil" in parts London, suggesting property values are hitting the ceiling of what buyers can afford to pay, a property website has reported.

Rightmove.co.uk says London has seen a decrease of 0.5% in prices, and puts it down to the capital's homeowners cashing on soaring values by moving to cheaper homes further afield. This exodus has led to a huge 23% month-on-month leap in the number in new properties coming up for sale, leaving buyers spoiled for choice.

Chancellor George Osborne announced plans last week to hand the Bank of England the ability cap the size of mortgage loans as a share of the borrower's income or the value of the house.

It appears the new, stricter mortgage lending rules which came into force in April have already dampened demand. Rightmove's director, Miles Shipside, suggests some sellers may have already missed the peak in the market, although prices in London are still up by 14.5% compared with June 2013 and now stand at around £589,776.