London house prices climbing again

Overseas investors seeking safe havens for their money have helped to make the house prices on London buck the national trend and actually increase, according to a new report. The report from the LSL/Academetrics House Price Index shows that the average house value in the Greater London area increased in November by 3.1%, compared to this time last year.

Over the past year, London is the only area in England and Wales to see their house prices increase in value, and the average price of a home in the capital is now £390,619. The prices of property across the rest of England and Wales have remained relatively static during November, and the average price of a home fell by only 0.7%, to £220,043 during the 12 months ending in November.

David Brown is the commercial director for LSL Property Services and he has said that the resilience in the prices of property indicates that both property buyers and mortgage lenders haven't, so far, been spooked by the gloomy news that is emerging from the eurozone.

He added that although the prices have dropped by 0.7% in the past year, the rate of price decreases has slowed everywhere except in the East Midlands and the North West, and London, buoyed by the amount of foreign investors who see London's bricks and mortar as a safe haven for investment, has seen the house prices rise by 3.1% during last month.

The report also found that the demand for properties in the highest priced areas of London remains buoyant, and the three London Boroughs who have the largest growth are also on the top 5 in terms of prices. The biggest rise in house prices was in the City of Westminster with 12.6%, Chelsea rose by 8.5% and Richmond Upon Thames by 6.2%.

The five boroughs who experienced the lowest growth in price are all in outer London according to the report. Over the past year, the biggest drop in property prices was experienced by Barnet which saw a decrease in value of 7.1%, whilst Havering dropped by 5.3%. The average house prices in Barking, Dagenham and Kingston Upon Thames fell by 2.4% and by 2.2% in Enfield.

Between August and October, the number of properties which were sold increased by 4.5%, compared to the same period in 2010. The property transactions rose by 35% in the city of London, 23% in Hackney and 20% in Greenwich.

Article Courtesy of The Property Forums