The east London borough of Hackney has emerged as the capital’s shining property star with prices up almost 13 per cent in a year, according to the latest figures from the Land Registry.
The average home in the borough will soon breach the £500,000 barrier — and currently stands at £474,202. The most expensive home currently for sale in Hackney is a converted church hall close to Victoria Park, on the market with Foxtons for offers above £4 million. You can still find bargains, however. The cheapest property is a studio flat in Clapton, also through Foxtons, for £139,950.
Philip Castle, a director at Sovereign House, said prices in the borough had been steadily rising for the last two years. He believes that this year’s dramatic rise has, in part, been caused by a “terrible lack of stock” as owners, still nervous about the economy, stay put.
Search for houses and flats for sale in Hackney
However, he has noticed an upswing in the number of owners having their homes valued and hopes that the stock famine will ease in the New Year.
Victoria Park is the most desirable part of Hackney, attracting buyers priced out of Islington, while Mr Castle tips Clapton as the area where prices will continue to rise. “It is a good investment,” he said. “People can get in not quite on the ground floor but while there is still growth to be had.”
Search for houses and flats for sale in Clapton
London wide prices are up 9.3 per cent in the last year to an average of £393,462, compared to the England and Wales average of £167,063 – but experts warn that strong price rises may fade away by 2016.
During the last year Hackney has outdone prime central London. Westminster prices have increased 3.8 per cent in the last 12 months, Camden values are up 11 per cent and Kensington and Chelsea managed a 7.5 per cent increase.
The figures show that Lambeth and Wandsworth are also performing strongly, both up 11.2 per cent.
At the other end of the spectrum Newham, the Olympic borough, saw prices fall 2.5 per cent in the last year.
Lucian Cook, director of residential research at Savills, pointed out that in 2007, at the peak of the market, prices rose by 16.8 per cent in the capital. “I don’t think what we are seeing is a boom,” he said. He predicts that the market in London will continue to grow for the next two years but then – as property becomes increasingly unaffordable compared to wages and interest rates rise – will flatten.
Meanwhile in the Home Counties and south east prices will start to rise in earnest in 2015, as the ripple effect from London takes hold. “Next year could be the last year when London outperforms the south east,” he said.