House prices for London fall for the month of October as the UK property market slows although areas outside the South East see growth.
Data from the Office of National Statistics (ONS) shows house prices in London fell by -1.2% for the month to October with the average home worth £474,475.
The fall in house prices in London of £13,174 is welcomed by first time buyers as they now they require a smaller deposit or lower earnings to purchase their first home.
For home movers although their the gap between their current home and the next may be reduced which means they need to borrow smaller mortgage.
Prices rise outside of South East
Other areas outside the South East have seen a robust property market with the East of England house prices up by 1.3% for the month to October 2016 and 12.3% higher year-to-year.
Average prices and annual change for the UK to October 2016 from the ONS are shown below.
| Area | Annual Changes | Property Values |
|---|---|---|
| London | 7.7% | £474,475 |
| South East | 9.1% | £312,509 |
| East of England | 12.3% | £279,148 |
| South West | 7.2% | £240,322 |
| England | 9.2% | £232,655 |
| West Midlands | 6.9% | £177,937 |
| East Midlands | 7.6% | £176,084 |
| Yorks and the Humber | 4.9% | £150,401 |
| North West | 6.3% | £148,586 |
| Wales | 2.7% | £147,065 |
| Scoltand | 4.3% | £143,131 |
| North East | 3.0% | £124,749 |
| Northern Ireland | 7.8% | £124,093 |
Apart from London property prices lower by -1.2% in October, other areas have seen a decrease such as the North East -1.3%, North West -1.2%, West Midlands -0.7% and Yorks and the Humber down -0.2%.
Despite these falls, the older equity release mortgage buyer can access wealth in their property and using this for home improvements, holidays or giving to a family member.
Since the weakness in the housing market after the referendum there is evidence of recovery for September and October 2016 which vary across regions and price brackets.
London boroughs still showing growth
Outer London boroughs and still showing growth with Barking and Dagenham up 18.2% over the year and relatively affordable with the average home valued at £287,978, up £44,439 over the year.
One advantage of rising house prices in London boroughs for homeowners is remortgage buyers can now release capital for home improvements such as upgrading their kitchen, bathroom or adding an extension.
Average prices and annual change in London for October 2016 from the ONS for the top ten boroughs are shown below.
| London Borough | House Prices |
Annual Changes |
|---|---|---|
| Barking and Dagenham | £287,978 | 18.2% |
| Havering | £358,351 | 17.6% |
| Newham | £366,485 | 17.1% |
| Bexley | £334,470 | 16.9% |
| Tower Hamlets | £488,189 | 14.4% |
| Croydon | £370,147 | 14.5% |
| Lewisham | £421,067 | 13.6% |
| Waltham Forest | £432,109 | 13.6% |
| Enfield | £400,486 | 13.2% |
| Harrow | £482,980 | 12.6% |
Although many boroughs have increased by 5% or more year-on-year some areas have seen prices reduce such as City of London down -8.8%, Kensington and Chelsea -4.9%, Hammersmith and Fulham -4.0%, City of Westminster -2.7%, Richmond upon Thames -1.2% and Camden -0.8%.
These boroughs have the most expensive properties in the country with an average price from £647,000 to £1.2 million and may have been adversely affected by a fall in demand from international buyers following the brexit vote.
With higher house prices in the capital buy-to-let landlords will look to outer London for affordable properties to help improve rental yields.
What are your next steps?
Talk to our London City Mortgage advisers if you are an older homeowner releasing equity from your property, we can recommend the lifetime mortgage to access wealth for home or garden improvements and holidays.
At LCM our mortgage brokers can provide advice if you are a first time buyer, moving home, want to remortgage your existing home to a new cost effective mortgage deal or are a buy-to-let investor.
Learn more by using the equity release mortgage calculator, property value tracker chart and mortgage cost calculator. Start with a free mortgage quote or call us and we can take your details.
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