The value of upmarket housing in London is coming under pressure because of economic uncertainty and the squeeze on City jobs, says Savills, the property agent. Financial Times

The price of London homes costing more than £1m fell by 1.5% in the first quarter, the property consultant said yesterday. This follows a 2% fall in the value of such homes in the final quarter of 2007.

The market for high-end residential property was more robust outside London, however, which saw prices drop just 0.5% during the first quarter.

The disparity between London and the rest of the country was likely to reflect the impact of job losses in the City and smaller bonuses this year, said Lucian Cook, Savills’ research director.

The market for homes above £4m in London performed much better in the first quarter, however, as wealthy buyers for these luxury homes tended to spend independently of economic cycles, Cook said.