London house prices dipped last month as UK asking prices jump £3,000
London asking prices dipped by 0.1 per cent to £680,800 last month, according to new data from Rightmove, bringing the annual change in asking prices to an increase of 2.5 per cent since March 2022.
It now takes an average of 70 days to secure a buyer for a home in the capital, according to the property portal, which is an improvement on the 74 day average recorded in January but well above the 57 day average seen a year ago.
Nationally, the average is now 57 days.
The only London boroughs to see asking prices drop over the past year were west London’s Kensington & Chelsea, where asking prices are now £1,672,000 after a fall of 1.8 per cent, and Richmond upon Thames in south-west London, which saw a decrease of 0.7 per cent to £899,000 on average.
The greatest increase in asking prices were seen in Camden, north London, which saw growth of 13.4 per cent in the year to March. Asking prices in the borough are now £1,121,600 on average. In second place was Barnet, also in north London, where prices are now £711,800 on average after annual growth of 6.8 per cent.
Marc von Grundherr, director of estate agent Benham and Reeves, said: “While the London market hasn’t performed as strongly as the rest of the UK during the pandemic market boom, momentum is building and while asking prices are still a little off the pace for this time of year, we’ve seen a strong and consistent level of buyer demand so far in 2023.
“This is down to the reversal of the pandemic-inspired exodus of London buyers looking beyond the capital for larger, more affordable homes.
“This reversal has been driven by a return to normality, both socially and within the workplace, with many buyers now keen to return to the convenience that London living provides.”
Across the UK
The average price tag on a home has jumped by nearly £3,000 in March, driven by asking price increases for bigger properties, according to Rightmove.
Across Britain, the typical price of a property coming on the market increased by £2,906 or 0.8 per cent compared with a month earlier.
This was mainly due to a 1.2 per cent or £7,947 average jump in asking prices in the largest homes sector, Rightmove said, which includes four-bedroom detached homes and homes with five bedrooms or more generally.
Across all property types, the average price of a UK home coming to the market was £365,357 in March.
The pace of the market reached an unsustainable level in the last two years
Tim Bannister, Rightmove
The 0.8 per cent price increase was below the average monthly rise of 1.0 per cent seen in March over the past 20 years, reflecting a higher degree of pricing caution by many new sellers, Rightmove said.
Overall, new seller asking prices are typically around £5,800 below a peak reached in October 2022.
Tim Bannister, Rightmove’s director of property science said: “The beginning of the spring season sees stability and confidence continuing to return to the market as it recovers from the turbulence at the end of 2022.
“The pace of the market reached an unsustainable level in the last two years, and was on track to slow to a more normal level, though the speed of this slowdown to more normality was accelerated by the reaction to September’s mini-budget.
“While higher mortgage rates and economic headwinds raise challenges, many potential home movers who were effectively side-lined in the frenetic bidding wars of the last two years will find that a slower-paced market gives them time to plan and secure their next move as we enter the traditionally busy spring-buying season.”
Sales of typical first-time buyer type properties with one or two bedrooms are seeing the fastest improvement.
One contributing factor to larger home sales lagging behind them is signs of a reduction in people making coronavirus pandemic-driven lifestyle changes.
While the London market hasn't performed as strongly as the rest of the UK during the pandemic market boom, momentum is building
Marc von Grundherr, Benham and Reeves
The proportion of buyers inquiring about making a move over 50km away from where they live is now 15 per cent, the same level as 2019 and below its pandemic peak of 18 per cent.
Rightmove also said that signs that inflation may ease back more quickly than previously expected may mean that increases in the Bank of England base rate are more tempered, which will have an impact on mortgages.
But it added that market conditions are changeable, and it remains to be seen how the mortgage market reacts in the coming weeks.