Hometrack - London Housing Market Continues to Improve
The September survey of the London housing market reports a 0.3% increase in house prices. This increase builds on last month's rise of 0.2% and further reverses the broadly downward trend seen since October last year. The highest rises seen this month are generally in the East and North of the Capital.
Twenty-two of the London boroughs saw prices rise over the month, with four boroughs seeing prices rise by more than 1.0%. Flat house prices were seen in six boroughs, with only five seeing prices lower this month than in September.
The highest price rises during October were reported in Waltham Forest (+1.9%), Newham (+1.4%), Tower Hamlets (+ 1.1%), Hounslow (+1.0%) and Bromley (+0.9%). The largest price falls were seen in Camden (-1.1%), Harrow (-0.5%), Hammersmith and Fulham (-0.4%), Croydon (-0.4%) and Brent (-0.1).
The 10 boroughs with the highest house prices rises have an average house price of £238,320 whereas the 10 boroughs with falling prices or lowest house prices rises have an average house price of £273,840.
Evidence of the continuing revival in the London housing market comes from many indictors:
The number of sales agreed rose by 9.6%, following a 1.3% rise in September.
Sales price as a percentage of asking prices has risen for the sixth month in a row to 93.2% - buyers are achieving smaller discounts from the original asking price.
Average time taken to sell has improved again for the second month - houses sell in approximately 4.9 weeks, compared to 5.7 weeks in August.
An average of 13 viewings take place before a sale is achieved - compared with more than 14 in previous months.
John Wriglesworth, Hometrack's housing economist, comments:
"With the London housing market showing continued signs of improvement, we are confident that the end of the year will be considerably more positive than the beginning."
"Expectations of interest rate rises are having very little adverse effect on buyers. However the number of properties coming on to the market is falling and with excess demand already occurring in several boroughs, further house price rises are almost certain."
"We are confident that house prices will continue to rise in the Capital next year - our new forecast for 2004 is an average of 3% across the boroughs. With sustainable growth both in activity levels and in prices, housing market disaster in London is now firmly off the cards."