London prices leap into 2016

London prices leap into 2016

  • Greater London prices jump 0.9% since December.
  • The average annual home price appreciation for England and Wales rises further to 8.2%, driven by lack of supply and low mortgage rates.
  • The total stock of property on the market drops to a new record low.
  • The mix-adjusted average asking price for England and Wales rises 0.3% since last month.
  • Typical time on market is 117 days across England and Wales: nine days less than in January 2015.
  • Supply of property entering the market indicates a slight annualised increase of 4%: the first such
rise observed for many months.
  • Prices rise in all regions except for the East, Scotland, Wales and Yorkshire during the last month.

2016 kicks off with significant optimism, especially in the capital region, according to the Asking Price Index for January 2016.

Sellers know full well that there is a shortage of supply and therefore see no need for cautious pricing. Consequently, prices jumped nearly a percentage point over the last month in Greater London, which corresponds with an additional £15,000 on the average home value.

Despite a small uptick in supply, the total number of properties on the market has fallen to a new low. Just over 386,000 properties are currently for sale: 47% less than in 2008. This trend looks set to dominate the UK property market in 2016.

So buoyant is the market that prices rose 0.3% across England and Wales over the last month, which is the highest such rise observed for January since the onset of the financial crisis and is at odds with the ‘normal’ seasonal trend.

High demand means that the typical time on market for England and Wales has hit a new post-crisis low for the month of January: nine days less than a year ago.

Overall, the current mix-adjusted average asking price for England and Wales is now 8.2% higher than it was in January 2015. For as long as the supply-demand imbalance worsens, this figure will continue to rise.

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