haart showed the average London house price has increased by 1.5% to £256,681 in November, up from £252,952 in October. House prices in the capital have risen almost 9% since the start of the year.
CONTINUED STRONG ACTIVITY LEADING TO ‘SEASONLESS’ MARKET
Housing market activity in London has remained unusually strong throughout November, with transaction levels up by 10% compared with last November, as buyers look to move before Christmas. The consistently high percentage of buyers continuing to enter the market looks set to reduce the effect of the traditional ‘quiet seasons’.
High demand and a continuing shortage of stock in November have pushed prices up to £256,681, the highest level for over a year, but buyers remain price sensitive and overpriced houses are not selling.
Paul Smith, chief executive of haart, commented: “Despite the interest rate rise at the beginning of the month, there hasn’t been a drop in buyers’ appetite to enter the market and as the festive season approaches, we look set to see an increasingly ‘seasonless’ market. Traditionally, the summer months and the Christmas period brought calmer phases with fewer people prioritising house hunting, but if the high activity continues, these ‘seasons’ within the market could start to become less noticeable.”
CHRISTMAS BONUS BONANZA SET TO BOOST PRICES
Smith continued: “City workers anticipating the arrival of their Christmas bonuses have already boosted activity levels in the capital. The number of potential buyers registered at our branches, particularly in the prestigious areas of London, has jumped considerably already. Millions of pounds are expected to be channelled into bricks and mortar in the New Year. However, while these City workers may be prepared to pay above the odds for their dream home, most buyers remain price sensitive and overpriced properties will not sell.”
FIRST-TIME BUYERS REMAIN WARY
The level of first -ime buyers in the market remained at 26% in November. The interest rate rise at the beginning of the month may have caused buyers to be cautious of making the step onto the property ladder.
Smith commented: “The Bank of England’s decision to raise the base rate to 5% in November will impact most on first-time buyers. However, there has been no decrease in the level of first-time buyers entering the market and this is a promising sign. Although this sector remains wary, the majority are still confident in their own financial security under a backdrop of economic growth.”
LONDON-WIDE VARIATIONS
All regions of the capital saw price increases this month, with the West experiencing the greatest rise at 4.5% followed by the South East of London with a rise of 3.3%. The South West still has the highest average price at £290,053.
