Price increases seen in London in February were lower than in regional areas of the country, the latest released report from Knight Frank has shown. It comes amidst a record breaking 40-month run of property rises in the capital, but the slowing of rises need not necessarily be bad news. On one hand, the rest of the UK is continuing to improve, playing catch up to the capital at the current time, while the slowing of price rises indicates that the market in London is becoming more mature rather than simply accelerating time and time again.
During February, the report from Knight Frank stated, the average price increase seen across London was some 0.7 per cent. This helped to bring down the annual rate of growth seen in final sale values in the capital, which now sit at 7.5 per cent. This was lower than the 9.4 per cent annual rate of rises seen across the UK as a whole as of the end of February.
"It may surprise some given the widespread debate about a price bubble in prime London," said Tom Bill, associate residential research with Knight Frank. "The causes for the shortage include the fact many vendors are declining to sell in the belief they are in a fast rising market which, in prime central London, is less true than it once was," he added.
While the rate of increase slowing in London compared to the rest of the UK might seem like a cause for concern though, it is actually more indicative of a much improved and mature market. While many have predicted that the seemingly constant rises in the city would bring about a property bubble, the latest report from Knight Frank stated that London is currently enjoying some of its most consistent times in recent years.
Throughout the entirety of the past year, annual price increases in the capital have circulated around the seven and eight per cent marks consistently. This means that the year as a whole has seen the most steady levels of improvement at any time since the early 1990s. This could help London to retain its status as a real safe haven for property investors.
- Monday 10 March 2014