London flat bought for £175,000 last year is now worth less than £100,000

(Evening Standard) -- A property investor who bought a flat for £175,000 at the height of the housing boom has ended up in a negative equity nightmare after its value nosedived by almost 50 per cent.

Maurice Conroy, who owns a string of buy-to-let flats, bought the studio in Pimlico last summer. But he has just had it valued by three agents who told him it would now only sell for £80,000 to £100,000.

He is one of a growing number of buytolet investors who are discovering the property market is not necessarily a safe alternative to a pension.

Mr Conroy, 43, from Chelsea, admits he paid over the odds for the flat a year ago, but said the news left him reeling.

"It's like being hit in the stomach," he said. "It's the biggest drop I've heard of and I scan all the property news. A £95,000 drop - that's 50 per cent. Even if it sold for £100,000 that's 40 per cent. I questioned the agents and they said they cannot value it at more than £1,000 a foot."

Two agents valued it at £100,000, while Hamptons International said it was worth no more than £80,000.