New research has revealed that the gap between property prices in England and Wales and London has closed significantly.
According to data from the Land Registry, the average price of property in England and Wales reached £221,832 in May, almost half the price of Greater London (£472,163).
This compares to previously released Land Registry data from March when property in London was three times more expensive than the rest of the country. These latest statistics demonstrate that prices in England and Wales have begun to feel the benefits of record low mortgage rates and recent government initiatives such as the 2014 reduction in stamp duty and the Help to Buy scheme.
Price growth in May reflected a healthy 1% increase versus the previous month, whilst prices were up 8.7% year-on-year, well above the average market appreciation seen since the credit crunch of just 4.9% per annum.
Despite the new Land Registry data suggesting that prices in England and Wales are quickly catching up, the picture in London also remains very strong. In May, prices were up 1.5% versus the previous month and 13.6% year-on-year.
Naomi Heaton, CEO of LCP, said: “This new data is certainly encouraging news for the domestic property market as a whole, where average prices are under £500,000.
“Despite the uncertainty pre-EU referendum and a widely anticipated pull back post 1 April following the introduction of the new 3% additional stamp duty levy, all areas appear to reflect high levels of appetite.
“One word of caution, however, is that this does not factor in any change in sentiment since Brexit. Weakening economic indices and potentially more stringent mortgage criteria imposed by banks may create a downward pressure on the domestic market.
“On the other hand, we predict the rest of the year will continue to demonstrate positive uplifts for the prime Central London property market, under £1 million, underpinned by the weak pound and continuing low interest rates.
“In January, one bedroom flats which were being marketed at an average of £675,000, are now being marketed at £750,000, an 11% increase. In contrast, the high value end of the market is still suffering from the impact of heavy tax increases and political uncertainty.”
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