London property market’s resilience is down to the continued price growth of houses, according to Chestertons.
The agency’s analysis of Land Registry figures shows prices for the capital’s houses have increased by 23.4% since February 2020, while the average price for flats has fallen marginally by 1.6%. Chestertons believes that this is the first time there has been a sustained and opposing split in how prices for houses and flats have moved in more than two decades.
Commenting on the phenomenon, Sebastian Verity, Chestertons’ head of research, said: “The first lockdown in early 2020 rapidly increased the demand for houses as more people worked from home and needed larger properties with outdoor spaces.
“It is now clear that this trend has continued in London; houses are growing in value quicker than flats and making up a larger proportion of the market than before the pandemic.”
Chestertons said research from the Bank of England supports this view as it found that nearly 40% of the growth in house prices between January 2020 and December 2021 had been due to an “increase in households’ … valuation of houses over and above the valuation of flats”.
Verity added: “These figures offer strong evidence that Covid has now left a structural and lasting impact on the capital’s property market.”
Although many people expected property prices to fall at the end of 2022, Chestertons’ analysis shows average property prices in London increasing from £580,329 in October to £588,573 in November.
