The latest figures from the Office for National Statistics have shown Simon Morris that London Property price growth has fallen significantly in the year to May 2015.
London housing market
The London housing market has long been considered the most robust element of the wider UK residential property sector. The ONS’ March 2015 House Price Index shows that whilst the average UK house price ticked up 9.6% in the year to March 2015, the average London house price rose 11.2% in the same period.
Average London house price increases 4.3%
The ONS’ April 2015 House Price Index tells a different story. The latest Index shows that the average UK house price only grew 5.5% in the 12 months to April of this year, whilst the average London house price only expanded 4.3% in the corresponding period.
Property Wire revealed that this shows that annual price growth in the UK capital has been slashed by half since March 2015. It’s the lowest rate of capital growth measured by the London housing market since October 2012. Furthermore, with average house price growth rates of 9.6% and 8.4% respectively, the East and South-East of England measured far higher rates of growth than London.
Marsh and Parsons’ chief executive officer Peter Rollings has argued that this change is temporary. He said: “This was simply part of a wider slowdown submerging the country in April, when we were still wading through competing election promises, and when demand at the highest rungs of the market was being dampened by a possible mansion tax.”
He went on to explain: “Now the ink has dried on the ballot papers, we’re back onto firmer territory. More recent barometers of the property market indicate favourable conditions with low mortgage rates and cheaper stamp duty costs keeping demand for homes buoyant, and carrying along a tide of buyer confidence.”
Choose the right investment
This suggests that now may be the time to buy a London property for under £500,000. If Rollings’ words are to be believed, investors could buy a residential property in the city and capitalise on expected price growth now that the UK capital’s residential sector is in “back onto firmer territory.”
Simon Morris would advise that any investor who chooses to pursue this strategy airs on the side of caution. As a matter of course, investors should always do extensive research and seek independent advice before they invest in the UK property market, so they can choose the investment option that’s right for them and their circumstances.