London house prices record another jump

Julian Harris
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HOUSE prices in London have increased for the second straight month, as the capital continues to defy the housing market slump afflicting the rest of the UK.

In London a positive balance of 21 per cent of chartered surveyors reported rising house prices in March, the Royal Institution of Chartered Surveyors (RICS) revealed today.

In February, a positive balance of 17 per cent of respondents in London reported a rise in prices.

No other region in England reported higher prices in either month, although prices were up in Scotland in March. Across the UK as a whole, 23 per cent more surveyors reported prices falling rather than rising.

“The rather negative outlook for property prices across the UK seems to better reflect the general economy than the micro climate of London,” said Ian Perry of RICS.

Yet the decline in prices across the UK is slowing, the report shows. The negative balance (reporting falls in prices) has narrowed from -31 per cent in January to -23 per cent last month.

Six in ten surveyors reported unchanged prices, while “the majority” of respondents who experienced a decline in prices were reporting falls of less than two per cent.

The UK-wide market appears to be stagnant, with the survey showing a small decline in new buyer enquiries and “broadly flat” supply from new vendors.

“The low level of buyer interest in many parts of the UK continues to impact on the market, resulting in some downward pressure on prices,” Perry said.

“With the prospect of forthcoming interest rate rises and continued shortage of mortgage funding, it seems that overall recovery for the national housing market is still some way off.”

Yet up to 3.5m homeowners – or 22 per cent of the mortgage-holding population – are unaware of how higher interest rates could affect their mortgage payments, according to a separate survey by price comparison website Unbiased, released yesterday.