Average asking prices in London have hit a record high of £650,000, with price growth driven by rising demand in the outer boroughs.
Buyers priced out of more central London locations because house price growth has vastly outpaced wage rises since the 2008 property crash have been increasingly searching for better value and more spacious homes on the capital's fringes.
Increased demand in these outer suburban boroughs has led to London house prices rising by an average of 1.4 per cent – or more than £8,500 – in the last month alone.
This growth has come despite the widely-reported market uncertainty since Brexit was announced in June last year, and the expectation that Article 50 will be triggered imminently.
London's "most affordable" boroughs
All 12 boroughs where average asking prices are below £500,000 – just over a third of local authorities – have seen annual price growth, according to the latest house price index from Rightmove.
Prices in Enfield in north London, where areas like Cockfosters and Palmers Green attract commuters looking for more spacious family homes, rose by 8.2 per cent annually, hitting £485,000. In the south eastern borough of Greenwich, prices hit £477,000, up 6.7 per cent year on year; and in Croydon, on the capital’s southern fringe, prices rose 6.1 per cent to £430,000.
“Whilst people are now more likely to hold out for that second or third bedroom rather than get a smaller place and move again a few years down the line, they are prepared to stretch more to get that home they will “grow into, rather than grow out of” and move a bit further out in the process to find the extra space," says Jack Malnick, sales director of estate agent Chelsea Square in Cricklewood and West and South Hampstead.
“This of course drives up the volume of people looking in the areas we cover in Brent and Barnet which logically, when demand is higher, means a rise in prices.”
Prime central London
Meanwhile some of the most expensive boroughs continue to be hit with falling prices. Kensington & Chelsea, formerly the most expensive borough in London, saw house prices drop by 19.4 per cent, pushing the average asking price below £2 million for the first time in nearly two years.
As a result, Westminster is now home to the highest average house price in London.
“Outer London continues to out-perform inner London in the price-rise stakes, and it is this trend of buyers looking further afield for value that is pushing up demand and therefore prices in many outer boroughs," says Rightmove director Miles Shipside.
“This has helped to push the overall average price of newly-marketed property in Greater London to a record high. With nine months having elapsed since the referendum and stronger demand returning to the market, there are signs that prices are becoming more resilient.”