London property prices have roughly increased by up to 618% on average since 1995. Further considering the average Loan To Value (LTV) on new home purchases during the period of ~70%, this would mean the average home buyer in London has seen his/her investment increase by a whopping 2060%
To the surprise of many, the area which saw the biggest price increase during the period was Hackney. Housing there increased by 886%, more than any of the other 32 boroughs of London. The average property in the borough is now a whopping £594,000 while it was only £77,000 19 years ago.
London’s worst performing borough is Bexley with a “dismal” 447% increase since 1995. Bexley also remains one of the most affordable boroughs with average house prices only reaching £273,000 in 2014.
In real terms however, the borough which saw the biggest price appreciation comes to no ones surprise; property in the borough of Kensington and Chelsea now costs on average £1,280,000, the only borough in the UK with average house prices over £1m. This compares to prices of £195,000 19 years ago or a 779% increase over the period.
As we enter 2015 a couple of events / policies / taxes which may influence the growth in London property house prices are as follows. There seems to be an early indication that stamp duty, mansion tax and global economics are leading to a fall in the price of town houses and luxury apartments in the United Kingdom’s capital. It seems prices of an upmarket London home fell by 4% in the last three months of 2014 as political uncertainty and stamp duty rises collided. This is likely to only affect a narrow pieces of the Central London home market as only homes priced around the £4m mark, deemed to be the threshold for luxury, were hit by George Osborne’s stamp duty overhaul.