Property prices are rarely out of the news at present, especially given the recent fall in house prices. People are always looking for opportunities within the property market that they can take advantage of. On the whole, searching for a property is now becoming a much easier pastime, but there is one area where that newfound trend doesn’t hold true, and that area is London.
According to theInternational Business Times, UK house prices blossomed by as much as 11.7% in the year leading up to August 2014, yet this average was hugely skewed by the inclusion of prices within the capital. If London was excluded from the list of average house prices, then the escalation of house prices would actually be just 7.8%, as London’s 19.6% rise is disproportionately large in comparison to many other areas of the UK.
Astonishingly, the average London house price is now in excess of half a million pounds, and the prices on London housing are now surging ahead at a staggering rate. The Guardian reports how London property is now regularly advancing by almost 20% a year in terms of prices, and that’s about five times more than the increases that might be found in the north-east of the UK.
Apparently, only Londoners who command salaries of more than £100,000 can now reliably afford a mortgage in the capital, and that sort of wage is far beyond the average figures in the area (about three times larger, in fact). Elsewhere in The Guardian, it has been related that London houses prices are now even more unaffordable than they were in 2007, which is a significant announcement for those who follow the UK property market.
2007 represents the previous peak of house prices in Britain, so the current situation in London is record breaking. For first-time buyers and couples without two full-time wage earners, the problem of house prices in London is especially hard to overcome, and such families are largely dependent upon the realisation of cooling prices in the capital, a trend which could now be drawing closer.
In terms of record-breaking figures, it should also be noted here that the gap between average property prices across the country is now as wide as it has ever been. The Telegraph notes that August saw the cost gap between properties in London and the North-East growing to an astonishing £360,000, which is more than the cost of the average UK home (approximately £274,000).
London has been seen to have somewhat of a ‘ripple’ effect in those areas that are close to it, but far-flung localities lie outside this ‘bubble’. Many people have chosen to move away from the capital if possible, electing to relocate to other counties in the immediate vicinity, and such activity has boosted prices in the south-east by more than 12%. No such boost has been seen in the North though, and London property is now 3.5 times more expensive than homes in the North-East.
It’s only a few years since London property was hitting 2.5 times the price of property in the North of the UK (these figures were seen back in January 2010), so the opening of this vast North-South divide has been extremely swift. Many people are now hoping that the promised slowing of house price growth in the capital will become evident, and soon, but only time will tell if this proves to be the case.
If you’re trying to get onto the property ladder in London, then it’s very easy to feel that you’re facing an insurmountable obstacle. The attractions of living in London are obvious, but the prices of a mortgage can be a problem, and if you’re in such a situation then contact the team at Search Mortgage Solutions by calling 0207 554 5685 or emailing firstname.lastname@example.org. We’ve had years of experience when it comes to serving as a mortgage broker in London, and can give you the very best guidance and services that you’ll ever come across.