Lack of Supply Causes London Property Prices to Stabilise

LONDON - Asking prices in London registered a modest increase of 0.27% in May, according to Primelocation.coms monthly house price index.

Andrew Smith, Primelocation.com’s Head of Research, comments: ” This is the fifth such rise in the past six months and provides further evidence that the year-long trend of rapidly falling prices has stabilized.”

Prices over the month rose in three of London’s five sub-regions. North West London (1.48%) and South West London (0.99%) recorded the largest price rises, while Islington, City & Docklands (-1.27%), the heart of the financial sector in the Capital, continues to be the weakest sub-region in London.

Prices in the country market have not been quite as resilient as in London. This month they recorded a slight fall of -0.13% after two successive months of rising prices. Five of the six regions recorded price falls with only the South West registering a month-on-month rise.

Year-on-year, the South West (-9.61%) and the South East (-5.84%) remain the weakest regional markets, which suggests that the pick-up in activity in London has not yet rippled outwards into surrounding commuter belt and second-home areas.

“While there is no absolute correlation between price trends and stock levels, it is worth noting that the recent stabilization evident in the prime market is closely related to patterns of supply.”

In London, for example, the North West sub-region recorded the largest rise in prices (1.48%) and the largest dip in supply levels (-1.62%), while prices fell furthest in Islington, City & Docklands (-1.27%) at a time when supply in this sub-region rose faster than anywhere else in the Capital (0.66%).

Prices are also related to demand and market sentiment. Figures show that visitors to Primelocation.com are up 32% year-on-year and a survey by the company indicates that 1 in 5 Primelocation.com users now believe that prices have already reached their lowest point.

The full Primelocation.com Prime Index is available to read at Primelocation.com/houseprices

Notes for Editor:

Primelocation.com is a property website containing information on UK and international properties for sale, estate agents, news and views about the housing market.

Contact Details: Christopher Evans Primelocation.com christopher.evans@primelocation.com +44(0)207-534-2609

Source: Primelocation.com

Contact Details: Christopher Evans, Primelocation.com, christopher.evans at primelocation.com, +44(0)207-534-2609