London house prices are now falling - Does this mean that supply is now greater than demand?

London house prices are now falling  - Does this mean that supply is now greater than demand? The average house price is £471,761. The average London salary is £34,573. 

The average London house price in 1997 was £106k , when the government changed that year they deregulated the bank of England ( and removed tax relief for  individuals but kept it for BTL  ( But To Let))   so that interest rates fell which had  a big impact on house prices as people could borrow a lot more at low interest rates and did so . The average  London house prices in 2010 were £385k So nearly a 4 X increase in prices due to the government of the days policies on interest rates.

but not yet to the degree that average salary levels are proportionate with average house prices (despite low interest rates and availability of debt). Apart from the relatively low average savings rate (needed for the minimum required deposit) there are other factors behind home ownership in London; until recently there were relatively few legal restrictions and foreign investors represent less than 10% of ownership (except for the very prime boroughs) so the government has started to focus on tax measures (stamp duty for example) and "anti-corruption" laws to subdue demand in tandem with encouraging developers (combined with demand from institutional investors) to increase the supply. Whether it's sufficient to increase affordability (for the average employee) is questionable and remains to be seen but there does seem to be widespread support for innovative solutions and the digital/technology industry has an important role (in my humble opinion). 

spot on Marcus, recent property bubbles in few of the above mentioned cities is a result of massive inflows from China and Russia and these inflows rather have a negative impact on markets of receiving countries because Estate prices shoot up and as soon  as the problems in Chinese and Russian economy are fixed there will be a lot of repatriation and then excess supply versus demand will create an equally artificial downward slide in property prices.