Increases in the value of homes in prime central London are not only far from being a bubble but are in fact almost exactly in line with a long-term norm according to property advisers London Central Portfolio.
The firm has analysed newly-released Land Registry statistics for the second quarter of this year, which show that sales volumes reached 6,546 over the year, an increase of 19.34 per cent over the previous 12 months and the highest level since 2007.
Prices rose by an average of 10.09 per cent - very precisely in line with the long term average since January 1996 of 10.5 per cent per year. The average prime central London property price is now £1,638,456.
Greater London saw stronger growth in Q2 at 12.09 per cent over the year. The average price now stands at well over half a million pounds, at £533,489.
The housing stock is still accessible to the domestic market. However, with the introduction of mortgage caps and the prospect of interest rises on the horizon, this increased activity may well subside according to LCP chief executive Naomi Heaton.
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Comments
Typo - 1996 was of course the bottom of the trough
Interested to see this vested interest picks the starting point as the bottom of the trough in 1989. If you take the top of the previous peak (Q1 1989, when prices were 20% higher than in Q1 1996) as the starting point it is around 6.5% per annum. Factor in inflation then even the current bubble is returning closer to 3.5% per annum real increases per annum since 1989.
Pull the other one.