The once booming London property market has been slowing for some time now, leading to the north being the more impressive in terms of growth.
Areas of London in which luxury flats are concentrated are expected to be hit the hardest due to the Brexit vote. Manchester and Birmingham are projected to be the new high growth areas in the country.
Nitesh Patel of Halifax says that:
“Affordability issues suggest that price growth will continue to remain low. [But] outside London, there are few signs of significant stresses.”
UK house price growth of 14% over the next 5 years has been forceasted by estate agents Savills, with London expected to grow at half that rate. The north west of engand is expected to grow 18% during the same period.
Wandsworth in London was a particularly poor performing area in terms of prices, with a fall of 15% recorded. This contrasts sharply with current hot-spot Blackburn which grew 16.4%.
The disparity between London and the rest of the country in terms of house prices is stark, at £484,000 for the average home in London compared with £244,000 elsewhere. The average house in London costs 9 times average earnings compared with 5 times in the rest of the country.
The property boom in London was in part fuelled by a lack of suitable properties, which does not seem to be the case in Blackburn.
The figures recently published by Your Move, showed that London's housing market continues to fall. A glut of luxury property developments may struggle to sell as it has been argued that the demand is no longer there. John King of Andrew Scott Robertson says that:
"The rest of the year is going to be tough, I don’t see a recovery until 2021,".
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London slump shrinks north-south divide in house prices