Property prices in greater London have passed the £600,000 mark for the first time, new data shows.
According to Land Registry analysis by property firm London Central Portfolio, average prices in Greater London now stand at £600,076 after going up a whopping 14% in the past year. In the last quarter alone prices have gone up 7.9%.
There was also an encouraging start to the year for London’s prime property market, with prices rising 4.7% over the past 12 months to hit £1,673,906.
Transactions shot up 33% over the quarter, driven by the rush to beat the stamp duty deadline in April. Volumes of sales increased 3.9% compared with the end of last year.
However, there is a different picture across England and Wales. Outside the capital average prices have fallen 0.87% from the previous quarter and now stand at £235,844. Sales volumes are also down 4.5%.
Naomi Heaton, CEO of LCP, said: “Whilst making for somewhat staggering reading, the increase in sales is not actually surprising. Buyers, wanting to access the prime Central London market, rushed in during the first quarter to beat the 3% stamp duty deadline which created an uncharacteristic surge. This one-off anomaly is likely to be steeply eroded next quarter, magnifying the contraction in sales already anticipated across the rest of the year.”
House prices are expected to soften as transactions fall following the first quarter stampede as the market adapts to the stamp duty rise. Brexit jitters and global economic uncertainty as international investors face struggling stock markets, falls in oil prices and an unsettled Chinese economy are also expected to have an impact.
Heaton said: “As has been demonstrated time and time again, Central London slows down in the face of investor uncertainty – for example, after 911, during the Iraq war and in the face of a weak stock market in the early 2000s. All the evidence, however, suggests that the market rallies quickly thereafter, particularly at the lower price points.
“In 2010, prices bounced back post credit crunch by 22.7%, following a fall of 16.3% the previous year. To capitalise on the current conditions, purchases should be focused on the sub-£1 million sector of the prime central London market. This has been far less affected by recent tax changes and future price growth is expected to be robust.”
