Press Comment: House Price Index shows London bubble is finally deflating
but prices could still cause brain drain
16 January 2019
If you are covering the UK House Price Index for November released today, please see the following comment from Gemma Harle, managing director of Intrinsic mortgage network, part of Quilter:
“The House Price Index for November 2018 released today revealed that while house prices dropped marginally month to month they have risen by 2.6% since November 2017 with the average mortgage over the year also rising by about the same.
“The London bubble is finally deflating after years of growth, with terraced being the only form of housing not dropping in price over the past year. However, regardless of this drop first time buyers in the capital still face an uphill struggle to get a set of keys to their first home. Such vast differences in the regional cost of a home for this group will start to take its toll on London’s skilled workers moving forward.
“Research by estate agents Hamptons International last year found the proportion of Londoners ditching the capital to move up north has tripled since 2010. Cities such as Manchester are seeing an influx of people simply unwilling to fork out huge sums for a roof over their head and London’s grip might be loosening on Britain’s brightest and best. While it is natural that you would imagine prices to be higher in a capital city of any country it is frankly ridiculous that the average mortgage for someone in London is £210,937 more expensive than the rest of England.
“Overall the market is as you might expect it, if not slightly better considering the historic era we are living in. However, every day we move closer to a potential no-deal Brexit and there is no telling what that might do to house prices across the UK. The house price index come April this year might paint a very different picture of house prices across the UK.”