Two bed flats in London will cost £1m in six months, agent predicts

The average price of a two-bedroom property in prime London could reach £1m in six months.

The prediction comes as the latest Land Registry house price index gives annual inflation for homes in England and Wales at 0.8% – but at 6.3% across London.

The monthly inflation figure recorded for July is 2.1% for London against 1% nationally. According to the Land Registry, the average house price in England and Wales was £164,098 in July, but £385,799 in the capital.

In two regions – the North-West and Wales – house prices fell by 0.1% and 0.5% respectively between June and July, and in five regions, house prices are lower than a year ago.    

The £1m price tag for a two-bed home prediction comes from Marsh & Parsons which says that the milestone will be reached by next March if prices continue to increase at the current rate. Prime London includes prime central London, as well as more outlying areas.

Two-bedroom properties in prime London have appreciated by 14% during the last year to reach a current average value of £909,203, says the agent.

If this rate of growth continues, the average price of a two-bedroom property in prime London will be £975,843 by the end of 2013 and £1,010,974 by the end of the first quarter of 2014.

Two-bedroom properties have experienced a much faster rate of growth than other types of properties, says the firm, which has two-bedroom properties on its books including the two pictured – a house in Clapham at £849,950 and a flat in Marylebone at £900,000.

Both are in considerable contrast to the studio in Brixton being marketed by Kinleigh, Folkard & Hayward at £99,500 which is being flagged up as possibly the last home in inner London ever to go up for sale at under £100,000.

However, it has drawbacks: a short 56-year lease means that only cash buyers are being invited along to tomorrow’s open day and the agents themselves describe the repossessed property as “horrendous”.

That, of course, has not stopped buyers from queueing up. This is, after all, London. There’s more about it from the Evening Standard at the link below.

Meanwhile, the Land Registry has also pointed to a pick-up in sales. Although its transaction data only goes up until May, 62,651 homes changed hands in that month – up from 52,516 in May last year.

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