Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Monday, 15 June 2015

UK house prices to record high

House prices to record high

It was no surprise that a decisive election outcome led to a marked uptick for the UK housing market, as an increased demand targeted a tighter market, with total listings down 8.5 per cent from a year ago.

Fears of a new "mansion tax" and "non-domicile tax status" rules subsided as the Conservative Party marched to a landslide election victory.

This is likely to be a plus for the London market in particular, where many of the wealthier investors both reside and choose to invest.

There is a level of urgency for the construction of new homes, particularly in London and the South East.

Rightmove's latest Asking Price Index saw average prices surge by 3 per cent in June, with average time to sell also declining from 87 days in January to just 65 days in June 2015.

This was the biggest monthly gain for asking prices since February 2014.

Asking prices are now at their highest ever level in the UK at £294,351, breaking the previous record high by more than £8,000.

London asking prices also hit a record high after a strong rebound in June to £613,922.

Smoothing the data on a 6mMA basis shows that both London and UK housing prices are resuming an uptrend, spurred along by record low mortgage rates.

The best performing London boroughs over the past year have included some of the less expensive boroughs, such as Croydon (+11 per cent), Tower Hamlets (+13 per cent), Hillingdon (+14 per cent) and Newham (+18.4 per cent).

The ripple effect out from London has also seen some of the strongest growth over the past year recorded in the East of England (+6.9 per cent) and the South East (+5.9 per cent).

Price gains have been notably weaker in other parts of regional Britain, such as the North East, North West, Wales and the West Midlands.

Rightmove noted a record May for the number of hits on its website at 115 million, a 22 per cent increase on May 2014.


One of the key drivers of the London market today is foreign capital.

It's something we have been debating a great deal in Australia too over the last year or two.

Notably Chinese purchasing power in Australia remains considerably higher in 2015 than it was in 2014, in spite of rising median dwelling prices.