The south east has overtaken London as the region with the fastest-growing house prices, figures published today show - despite the average asking price in the capital hitting £596,000 in the year to October.
According to research by Rightmove and Oxford Economics, prices in the capital grew 9.6 per cent during the period, while the wider south east grew 10 per cent.
The figures predict the south east will continue to head the list over the next five years, with prices expected to increase 35 per cent during that time.
London prices are expected to grow 33 per cent and the national average by 30 over the same period.
South east on top
Rightmove reckons the south east’s move to the top spot was due to a combination of Londoners taking advantage of high prices and buyers being priced out of the market. Miles Shipside, its director, said:
The ripple effect of buyers priced out of London combined with those cashing in and moving out of the capital means that the south east has taken London’s boom-town crown.Upwards price pressure is being further fuelled by a reluctance of homeowners in the hotspots of the south east to come to market.Some can see the value in holding onto their fast-appreciating property asset, whilst others cannot find anything for sale locally on the market that tempts them to sell and move on.While the south east’s new seller numbers this month are up on last year’s, at just three per cent increase this is the lowest pick-up in properties coming to market in any region in the face of the highest increase in demand.
The last point may have a large bearing on the increases. The number of new sellers increased 10 per cent nationwide, but only three per cent in the south east. An increase in demand not met by an increase in supply is a recipe for price rises straight out of economics 101.
Even with that upward pressure, prices in the south east still have some way to go before they catch up with the London heights.
Although the talk is of new highs and a double-digit increases, the general consensus is that the market is slowing. The price rises come during the usual October uplift, but the seasonal jump, at 2.6 per cent nationally, is the smallest for six years.
In London there was robust growth of seven per cent and in the south east 2.2 per cent. In some regions, however, the figure fell between September and October.