London House-Price Surge Drives U.K. Values in Spring BounceScott Hamilton
London house prices surged this month, helping national values post their best annual increase since before the financial crisis, Rightmove Plc said.
Asking prices in the U.K. capital jumped 5.2 percent to an average 541,313 pounds ($905,500) from January, the operator of Britain’s biggest property website said in a report today. On the year, they rose 11.2 percent. Nationally, values rose 3.3 percent from the previous month and 6.9 percent on the year, the best annual performance since November 2007.
“This month’s large rise is exacerbated by being a rebound from the festive-season lull,” said Miles Shipside, a director at Rightmove. “The spring moving season is traditionally the busiest time of the year, so that means agents are likely to advise new sellers to aim high, with the best-selling months ahead of them and strong buyer demand in many areas.”
London is leading the housing market as supply fails to keep up with demand and the capital’s economy powers U.K. expansion. Bank of England Chief Economist Spencer Dale said last week that while the market isn’t heading for a bubble, policy makers are “watching it very carefully” after ending mortgage aid through the Funding for Lending Scheme last year.
Rightmove isn’t the only report to show London leading the property market. A report from Acadata last week showed U.K. house prices rose to a record in January, with London values rising faster than any other region.
The boroughs of Greenwich and Bromley posted the largest monthly gains in the city, with increases of 8.2 percent and 8.1 percent respectively. The Merton and Sutton areas had the smallest increases, of 1.7 percent and 1.8 percent.
While new properties being listed for sale jumped 18 percent this month compared with a year ago, supply is still failing to keep pace with demand, Rightmove said. As a result, the average available stock per estate agency branch fell to 57 properties from 58, it said.