New data released today hints that London property prices might finally have turned a corner and started to increase again – the first time since April 2023. According to Zoopla, the city’s year-on-year increase sits at 0.2 per cent, with the average property price in the capital now standing at £536,300.
Across the UK as a whole, there was a rise of 1.4 per cent over the first seven months in 2024, a contrast to the first seven months of 2023 when prices only increased by 0.1 per cent. Other data supports a revival in the market with buyer demand reported to be up 20 per cent and sales agreed up 23 per cent year-on-year. As a result, Zoopla predicts that houseprices will be 2.5 per cent higher over 2024. That said, it’s a mixed picture regionally, with the South East and South West still in negative figures at -0.7 per cent and -0.6 per cent respectively.
The general trend nationally was for rising house prices in lower value areas where there is more affordable housing, including Wolverhampton (3 per cent), Oldham (2.8 per cent), and Wakefield (2.7 per cent).
Where in London is up and where’s down?
At a more local level, there was no overall pattern across Greater London. The borough of Merton, where the average property price is £555,600, showed the biggest annual increase at 1.1 per cent. This was followed by Greenwich at 0.7 per cent and an average price of £421,100, and nearby Lewisham, up 0.6 per cent to £447,000. At the other end of the table, the City of London saw the biggest fall, 2.3 per cent to £768,900, followed by Havering with a 1.4 per cent drop and average price of £415,700, and Enfield, which had a 1.3 per cent decrease to £434,400.
If you look at the data over the last seven months, when prices have been rising, things change again. “Over the first seven months of 2024, prices are up in Redbridge by almost 2 per cent followed by the City of Westminster,” says Richard Donnell, Executive Director at Zoopla. “Prices are higher in other central London boroughs this year supported by a return tooffice working and values rising off a low base. Prices are lower over the seven months to date in the City of London and Enfield.”
Price sensitivity
While this news might be positive, sellers need to be aware that increased mortgage rates and a healthy supply mean buyers are still very price conscious. Across the country, one in five homes experienced a cut to their asking price of at least 5 per cent and those that were incorrectly priced in the first instance took twice as long to go under offer. Zoopla foundit took 28 days to agree a sale where there was no asking price reduction but 73 days where the asking price needed to be cut to create a demand. A larger proportion of homes that had a 5 per cent asking price went on not to sell at all. The average estate agent now has 33 homes for sale, the highest level since 2017. This highlights that, while the market is likely to pick up following the holiday period, getting the asking price right first-time round is key for vendors.
“Momentum in the sales market continues to build as mortgage rates drift lower and more and more sellers gain the confidence to list their home for sale. Buyers have much greater choice which will support sales numbers, but this will keep prices rises in check,” says Donnell. “Buyers have less purchasing power than 2-3 years ago and remain price sensitivemeaning sellers can’t afford to get ahead of themselves on where to set the right price for their home.”
