House prices hit new heights in London's cheapest borough: Barking and Dagenham records rise of £55k in a year

Property prices in London have hit a new record this month, with the steepest rises recorded in the capital's most affordable borough, Barking and Dagenham.

According to new figures from Rightmove, new seller asking prices have increased in 23 out of 32 boroughs as more owners put their homes on the market ahead of the spring sales rush.

Home hunters are already targeting areas on the outer edges of London to find more affordably priced homes. Yet it's the capital's cheapest borough - Barking and Dagenham - that has recorded the highest annual hikes, adding an eye-watering £55,000 to the area's average asking prices in just one year.

Miles Shipside, Rightmove director and housing market analyst, comments: “While first-time buyer properties will be at the cheaper end of the £291,638 average in Barking & Dagenham, those that were hoping 2016 would be their step onto the housing ladder have found that the first rung is now set far higher than a year ago."

The latest price hikes follow the recent extension of the Government's 'Help to Buy London' scheme, which aims to help cash-strapped buyers onto the property ladder. However, with average asking prices across the capital now reaching an all-time high of £643,843, even buyers using the scheme will be priced out of many London districts.

Mortgage guarantees for Help to Buy are capped at 4.5 times annual income, with equity loans covering new-build properties valued up to £600,000.

Simon Woodcock, Managing Director of Robinson Michael & Jackson in Medway said: "Only three of the homes we sold to first timers in January were bought with Help to Buy’s aid. Instead, we are seeing a resurgence of the Bank of Mum and Dad. Many parents are remortgaging to release equity from their own homes to pass on to their children."