Quarterly house price growth slowed to 3.1% across Prime London, down from 4.3% in the first three months of the year. Over the course of Q2 2014, monthly house price growth in Prime London fell from 1.8% in April to just 0.4% June, as the market returns to more normal conditions.
At the very upper echelons of the market, this trend is even more acute as house price growth levels off. In the past year, there has only been just a 1% increase in the proportion of Prime London properties worth £3 million or more.
Over the last three months, supply of available of property in Prime London has jumped 26%, which has calmed the level of competition in the market, and stabilised house price rises. Overall, we’ve seen the number of registered buyers per property in Prime London fall from 24 in January to 16 in June.
Peter Rollings, CEO of Marsh & Parsons, comments: “After a frenetic start to the year, the pace of house price growth has slowed this quarter as the market stabilises and returns to more normal trading conditions. With more choice coming onto the market, sellers are able to find their next onward purchase and consider trading up. Calmer conditions in the market have meant buyers view purchasing London Prime property as a less daunting process than has been the case previously.”
Outer Prime London is outperforming central areas with the strongest house price growth across the past quarter. Property values here have risen 4.3% in the three months to June, compared to a quarterly increase of just 2.1% in Prime Central London. As a result, the price premium you can expect to pay for a property in Prime Central London has now fallen to a record low of 41%, down from 47% in Q2 2012.
Clapham, Brook Green and Balham top the charts with an annual house price growth of over 20%. In Brook Green, house prices have increased 8% in the last three months alone – while properties in Holland Park and Chelsea have only risen by the same percentage over the course of a whole year.
In particular, due to a huge uplift in demand among first-time buyers, one-bedroom properties in Outer Prime London have risen in value at twice the speed of one-bedroom homes in Prime Central areas of the capital. The average value of a one-bedroom home in Outer Prime London has increased by 6% in the past three months to £530,264, compared to an average of £646,833 in Prime Central areas of the capital following only 3% quarterly price growth.
As a result, one-bedroom properties in Outer Prime London have now seen the fastest annual growth of any property type across the city, up 28% in the past year – equivalent to £116,622, or £320 a day.
Peter Rollings continued:
“For the majority of us, owning a slice of the real-life Monopoly board will continue to be an aspiration. But there is a property market outside of the world-famous postcodes of Prime Central London – and it’s starting to steal the limelight. As prices in the capital have steadily risen, areas further afield have enjoyed a huge renaissance in popularity. Offering a more affordable range of house prices and a ‘village’ vibe, Outer Prime London has extended a crucial olive branch for growing families and young professionals taking their first step onto the property ladder. The average price of a family home with two or more bedrooms here is less than half that in more central areas, but also offers some of the best capital gains in the long term – as high demand fuels some of the most significant house price rises witnessed in London.”
