The gap between property prices in England and Wales and London has closed significantly according to a new data set released by Land Registry in conjunction with the Office of National Statistics (ONS).
The average price of property in England and Wales reached £221,832 in May, now standing at almost half the price of Greater London (£472,163). This compares to previously released Land Registry data from March when property in London was three times more expensive than the rest of the country.
Record low mortgage rates and recent Government stimuli initiatives such as the 2014 reduction in Stamp Duty and the much trumpeted Help to Buy scheme seems to have pushed prices up outside of the capital. Price growth in May reflected a healthy one per cent increase versus the previous month, whilst prices were up 8.7 per cent year-on-year, well above the average market appreciation seen since the Credit Crunch of just 4.9 per cent per annum.
Despite the new Land Registry data suggesting that prices in England and Wales are quickly catching up, the picture in London also remains very strong. In May, prices were up 1.5 per cent versus the previous month and 13.6 per cent year-on-year.
“This new data is certainly encouraging news for the domestic property market as a whole, where average prices are under £500,000” comments Naomi Heaton, CEO of London Central Portfolio.
“Despite the uncertainty pre-EU referendum and a widely anticipated pull back post April 1st, following the introduction of the new 3% additional Stamp Duty levy, all areas appear to reflect high levels of appetite.”
“One word of caution, however” Heaton adds “is that this does not factor in any change in sentiment since Brexit. Weakening economic indices and potentially more stringent mortgage criteria imposed by banks may create a downward pressure on the domestic market.”