According to worldwide Immobilien Consulting firm Cushman & Wakefield, for the first time in 41 years, London's average house price doubles the UK average. London homes now cost twice as much as the UK average for the first time since society was built. Data on home prices published nationwide in 1973. Although salaries have grown in London, they have not kept pace with domestic price rises - Londoners only earn 30% more than the average UK, according to the Office for National Statistics. Anecdotal data shows that homeowners flee to London to take advantage of the significant price differential between London and regional housing markets, particularly for the major commuting hubs. Nationwide price index states that the new average London home price is £362,699, which is well over twice the United Kingdom average of £178,124. In historical terms, London home prices for the last 41 years have been 1.5 times higher than the UK average. apartments
"UK residential development and investment team Cushman & Wakefield," stated Jack Simmons of Cushman & Wakefield. "The UK is still dominated by house prices in London, but affordability is starting to pinch for capital dwellers. This is the first time that London houses are double the national average. We shall witness a division in the UK where Londoners are compelled to rent while their counterparts in the area are able to buy. In future, in London, I may imagine a younger generation rent instead of long-term debt."
Additional key residential indicators for London in Q2 2014 include:
Growth in property prices: house prices in London are 19% higher than in 2007 (+50 percent in prime).
House price forecasts in London: The mainstream London price increase projection is 9.2% this year and 7.3% in 2015. Due to the good beginning in 2014, 5.1% has already been achieved.
Projections for UK home prices: The general prognosis for UK housing has been somewhat improved during the past quarter. In 2014, price growth is predicted to rise by 7.3% and in 2016 by 5.6%.
The 95% mortgage loan in London amounts to 57% of net income for mortgage payments. This share is projected to continue to climb as interest rates rise. The ceiling was around 69 percent before the global financial crisis.
United Kingdom affordability: Accessibility is fair in the region, with space to absorb projected housing prices and loan rates.
Mortgage approvals: The Mortgage Market Review (MMR) adds additional administrative strain on the mortgage applicant, which explains that in the first quarter of 2014 the approvals fell by 7%.
Listed builders of the house: In the five years to May 2014, the FTSE All Share has grown by 59%, compared with an average of 141% for households. The shares of the sample builders have fallen on average 15 per cent since February compared to flat results for the FTSE All Share.
Interest rates: Economists expect the first rise in the first half of 2015, although the recent statements of Mark Carney might occur sooner (Mansion House speech June 2014). For the Treasury Consensus, the median prediction of the 32 economists questioned is that by end of 2015 interest rates would be 0.9% and by end of 2016 1.6%. (now 0.5 percent).
Exchange rates: the dollar value of the pound has increased to its highest level since the middle of 2008.
Recent building data indicate a clear disparity between the residential market in London and the rest of the UK. After 1980, new homes have represented 8% of all new buildings in London. However, the proportion has increased considerably since the global financial crisis to 20%. Outside of London and the South East the picture is considerably different. Construction is more than 25 percent lower than before the global financial crisis for six of the UK's 11 regions. Overall, the construction sector is performing well and regional developments should take place (planning applications have picked up significantly in some markets). The protracted delay in ordinary dwellings is disappointing considering the undersupplied presence of the UK market, but the demand-to-supply strength remains a chance for eager investors.