271: London house price growth hits 32 percent

Navigation trail: / latestnews / archive / 271 - published: 11-04-07

LONDON (Reuters) - Record monthly house price growth in the prime central London property market has boosted annual inflation to 32 percent, figures show.

Prime property prices increased by 3.1 percent in March -- the highest monthly rate of growth on record -- according to the Knight Frank Prime Central London Index.

That has led to inflation at the top end of the property market -- flats and penthouses with an average value of over 1.5 million pounds and houses with an average value of close to 3 million pounds -- running at 8.9 percent in the past three months, 17.3 percent in the past six months and 32 percent in the year to end-March.

But while the houses in prime central London increased in value by 10.2 percent in the first three months of the year, flats saw a more modest 7.5 percent lift.

Prime property prices in central London have now risen for 27 consecutive months, with the last price fall recorded in December 2004, according to the index.

Chelsea and St John's Wood continue to be among the best-performing areas.

Liam Bailey, Knight Frank's head of residential research, attributed the stellar performance to demand far outstripping supply.

"As City bonus money filters out of the market, continued strong price performance can be explained by supply shortages and ongoing international demand," he said.

"The supply of newly available property fell by 27 percent compared to the total for February, while the number of new prospective purchasers increased by 16 percent, fuelling the price rise in the market."

Source:

Reuters.co.uk