London house-price growth slows after best year since 2006

LONDON: London house-price growth slowed this month after the best year since 2006 as values slid in the most expensive districts of Westminster and Kensington & Chelsea, Rightmove plc said.

Asking prices in the city increased 0.2% to £514,704 (RM2.8 million), after growing 10.6% last year, the operator of Britain’s biggest property website said in a report yesterday. Values in Westminster slid 8.3%, while those in Kensington dropped 6.9%.

“The average asking price of property coming to market is having a pause after a pretty hectic year of heady rises,” said Miles Shipside, a director at Rightmove in London.

London is leading the housing market as supply fails to keep up with demand and the capital’s economy powers UK expansion. Bank of England governor Mark Carney predicted last week that housing will continue to strengthen in 2014, and while policymakers have downplayed concerns that prices could spiral, they scaled back a mortgage lending programme last year.

Capital Economics Ltd said in a report that London’s economy will expand 4% in 2014 and 2015. It has projected a 3% annual increase in UK gross domestic product.

“London almost certainly led the UK’s growth rate in 2013,” said Richard Holt, an economist at Capital Economics. “We project that to continue this year and next, with several of the UK’s more northern or peripheral regions and nations bringing up the rear.”

Rightmove isn’t the only report to show London leading the property market. Data from the Office for National Statistics last week showed that UK annual house-price growth was 5.4% in November, compared with 11.6% in the capital.

London has Britain’s most expensive properties, with the average value in Kensington £2.05 million in January. This compares with the national average of £243,861. In Westminster, homeowners are looking for around £1.39 million for their properties. — Bloomberg

This article first appeared in The Edge Financial Daily, on January 21, 2014.


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