London house prices: Tower Hamlets asking prices hit new record

Thanks to a pre-Christmas rush and a wave of premium-priced new homes, average asking prices in areas such as Canary Wharf and Wapping have risen to record highs this month, despite being in one of London's poorest boroughs.
The average asking price for homes in parts of the east London borough of Tower Hamlets has risen by almost £100,000 over the past year, according to new data from Rightmove.

News of the steep annual hike comes as an increase of £50,000 has been recorded in just one month, thanks to an influx of new homes hitting the market in areas of the borough including Canary Wharf and Wapping, and a post-summer, pre-Christmas surge in demand from buyers. 

These high-end properties include a £5.5 million penthouse in St Katharine Docks, one of Tower Hamlet's most expensive enclaves. Their arrival on the market has caused average asking prices temporarily to rocket in a borough where starter homes and studios can still be found priced from £160,000.


"Tower Hamlets has become an area for investors and also people looking for more house for their money in a fairly central location," says Will Wisbey, manager of estate agent Hamptons in Tower Bridge. "The cheaper parts are playing catch-up."

However, whether sellers will achieve these asking prices is another question. "A stock shortage is leading people to be more optimistic with their prices, but this will not necessarily translate to sales," says Hamptons head of research, Johnny Morris. 

House prices, while at record highs across the capital, are showing much slower growth compared to last year. However, only five London boroughs still offer homes averaging less than £350,000, the Rightmove research reveals.

"London is the only area in the UK where affordability is worse than before the downturn, and buyer sentiment is weak because Londoners are really having to push themselves to get on to the ladder or to move to a bigger home," says Morris. "This is causing prices to hold fairly still."

Follow us on Twitter @HomesProperty and Facebook