Here at Stokemont, as RICS Registered Valuers, we take great pride in ensuring our understanding of the Property Market is up to date and take into account all necessary peaks, dips and changes.
House prices in London have peaked at this point, reaching an all-time high. Despite this, they are only going up at half the speed of the rest of the country, which is very interesting and reflective of things to come!
At the moment, the average cost of a property in the capital is £520,000. This is a 5.1% increase in a year, and a 0.2% increase in a month.
However, it’s also worth noting that the rise was the slowest for any part of the UK. Furthermore, the costs were only half the national annual rate of 10% increase. The typical cost of a home in the UK currently stands at £270,700.
Interestingly enough, property markets across the different regions have frequently outperformed the property market in London throughout the COVID-19 pandemic. This is speculated to be in part because of the race to find more space during lockdown, but also because stamp duty had a much more considerable impact on buyer properties outside of London.
Despite this, estate agents in the London area have said that interest in new homes surged in the New Year, with registration for new buyers double the level of 2021.
Across the capital, the biggest increases were seen to be in the Camden area, which saw a 17.9% increase, the Islington area, with a 15.3% increase, and the Richmond and Enfield areas, with a 9.8% increase.
London’s prices actually, as set above, the average home now costing nearly £520,000, limits affordability and as such, growth. While there remains considerable uncertainty in the outlook for the market, at Stokemeont, we do expect prices to continue to rise in 2022 but at a slower rate than seen in 2021 as conditions start to normalise.
Going into 2022, the most significant risk to the outlook is the ongoing pressure on the cost of living. This, combined with inflation in December surged to the highest rate in 30 years. This financial crunch is likely to impact consumer confidence, limit buyer willingness to make major financial decisions such as buying a home.
It’s worth noting that with the Bank of England aiming to stabilise the economy, it’s likely that they may also move to increase interest rates over the coming weeks in an attempt to control inflation.
One thing is for sure, property remains a great investment. It’s safe and will always be subject to the demand we’re all used to.
Over the next couple of years, it’s going to be an interesting time for London. We expect it will be outperformed as buyers look slightly further a field and consider getting a little more space for their money. One thing is for sure is that the way in which we all work has changed and as a result, the need to commute to the officer each day is no more.
If you would like to discuss your property valuation matter with our team of RICS Chartered Surveyors and RICS Registered Valuers, give us a call today and we will be more than happy to assist you.