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London’s long property boom came to a juddering halt last year with the first annual fall in prices since the financial crisis, according to latest figures.

Homes in the capital fell in value by an average of 0.5 per cent, or £2,151, over the course of 2017 to end the year at £470,922, the data from building society Nationwide reveals.

Prices in the capital had not previously gone into reverse since 2009 when London was still reeling from the impact of the banking meltdown that followed the Lehman Brothers collapse.

But the overall fall of 0.5 per cent hid marked contrasts between the overheated centre, where sliding prices are now 15.9 per cent below their 2014 peak, according to agents Savills, and the more affordable suburbs where they are still rising.

It places London at the bottom of the regional growth league table for the first time since 2004.

The new top property hotspot is the West Midlands, for the first time since the Nationwide figures began to be compiled in 1974, with a 5.2 per cent rise.

However the capital remains by far the most expensive place to buy a home in Britain with prices more than double the national average of £211,156.

London’s property boom peaked in 2014 when the market roared ahead by 21 per cent, but has since been pegged back by first time buyers being priced out of many areas, tax changes, and uncertainty over Brexit, according to commentators.

Jonathan Samuels, chief executive of property lender, Octane Capital, said: “How the mighty have fallen. Not so long ago it would have been inconceivable for London to have been the only region not to have delivered positive returns in a calendar year.

“London, without doubt, has been a victim of its own success. Prices reached absurd highs and it is now paying for its irrational exuberance.

“The fact that it takes roughly ten years for the average buyer to save for a deposit in London, underlines the affordability crisis many people face.

“Saving for a deposit, in a low interest rate and wage growth environment, is nothing short of brutal.”

Ewen Bunting, head of sales at estate agents James Pendleton, said: “A generation of house buyers will never have witnessed places like the West Midlands becoming property hotspots while London struggles.

“Strong employment, a lack of property for sale and low interest rates continue to support prices across the country while the capital is unlikely to respond to the Chancellor’s scrapping of stamp duty for first-time buyers.”

Jonathan Hopper, managing director of buying agents Garrington Property Finders, said: “The years of double-digit price growth in London’s hottest postcodes were always going to be unsustainable, and 2017’s modest fall in prices in the capital has injected a valuable reality check.

“Demand is being channelled by one over-riding consideration – affordability. With wages falling in real terms and buyers wary of overpaying while the market is in flux, even the most determined buyers are willing to walk away if the price isn’t right.”