London house prices show growth of up to 4.9%
First published on KensingtonHouse.com on 1 August 2024. Figures, forecasts and quotations reflect that date and have not been updated. Read it as a record of the market at the time, not as a current view.
The latest data from the Office of National Statistics showed property prices in London increasing in May, with the average price hitting £523,376. The headline figure of 0.2% growth across the capital’s property market – which is really a collection of micro markets – masked some much bigger increases in certain boroughs, particularly in outer London. Property prices in Merton, an area of south-west London that includes Wimbledon, Mitcham and Morden, rose by 4.9% in the 12 months to May, while Hounslow, which extends from Chiswick out to Heathrow airport, saw a 3.7% increase. It is great to see two of Kensington House’s investment areas doing so well.
“Mortgage rates have settled, giving buyers more certainty and confidence to bid above asking prices”
Karen Noye, a mortgage analyst at wealth management company Quilter, said that a “much more positive” run of economic data was “feeding through to buyer sentiment and causing house prices to rise”. She added that “mortgage rates have settled somewhat too, giving buyers more certainty over costs and more confidence to bid above asking prices, pushing prices up.”
Sara Palmer, a director at The Mortgage Lender, said: “A consistent increase in house price growth this year suggests a growth in consumer confidence. The recent cuts in mortgage rates by leading high street lenders provide a sense of security for prospective buyers, especially with a potentially reduced interest rate by the Bank of England to come later this summer, helping to drive demand.” The consumer price index (CPI) was still holding steady at the Bank of England’s 2% inflation target as of June, making buyers feel wealthier and increasing the likelihood of a base rate cut at either one or both of the MPC meetings on 1st August and 21st September.
Editorial note: the company name has been updated to Kensington House.
Original publication: kensingtonhouse.com, 1 August 2024. The organisations quoted are named in the text; their figures are reported as they stood on the publication date.