Small rise in Tower Hamlets house prices
- Credit: PA Wire/Press Association Images
House prices in Tower Hamlets have risen by 0.1 per cent in the last year - despite a 3.3pc drop in August.
The latest data from the Office of National Statistics shows that the average property in the borough sold for £446,322 – significantly higher than the UK average of £232,797.
Across London, property prices have fallen by 0.2pc in the year to August, to £486,304. The capital underperformed compared to the UK as whole, which saw the average property value increase by 3.2pc.
The average homeowner in Tower Hamlets will have seen their property jump in value by around £137,000 in the last five years.
The figures also showed that buyers who made their first step onto the property ladder in Tower Hamlets in August spent an average of £433,885 – around £133,000 more than it would have cost them five years ago.
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Lawrence Bowles, associate director of the research team at estate agents Savills, said the uncertainty over the outcome of Brexit negotiations was fuelling a “tougher lending environment”.
He said: “House price growth in real terms is slowing, and inflation is growing at the rate we’ve been used to over the last few months. Buyers, sellers and lenders are all thinking maybe they should wait until they see the outcome of negotiations.
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“Longer term, the issue we expect to see is affordability, as we expect the Bank of England base rate to be back above 2pc by 2021 – closer to historical levels, rather than the ultra-low rates we have seen in recent years.
“That, combined with stricter affordability stress tests, will make it more difficult for households to demonstrate that they are able to afford mortgages.
Between July last year and June this year, the most recent 12 months for which sales volume data is available, 2,734 homes were sold in Tower Hamlets, 37pc fewer than in the previous year.
The highest house prices in the country in July were found in Kensington and Chelsea, London, where properties sold for an average of £1.35 million – 16 times the cost of a home in Burnley, where the average property cost just £85,900.