I'm a newby, but thought I'd drop a line on the forum about my experiences in SE London. Prices are dropping like crazy here since the new year. I am (with my wife) looking for a 2/3 bedroom house in SE London for between Â£160k and Â£190k -- this time last year, no chance. Now, the properties are simply not selling and vendors are dropping prices by as much as Â£10k at a time. We are now looking at properties with sale prices in the 170-80k range and estate agents saying that sellers will be taking offers on this. Walk around Plumstead at the moment and you will see only 'FOR SALE' signs and no 'SOLD' signs. Things have changed quite quickly, and it is clear that estate agents are getting worried about the lack of buyers (at least at this price range).
I realise that this is a bit of a microcosm, but I have been amazed at the rapid change in the market, and will probably hang on a couple of months to see if things really do go through the floor. Although (at least in London) I don't think 2/3 bedroom houses are ever going to dip below 150k.