London house prices now a record GBP521,000 on average — but growth lags behind rest of UK

London saw an increase in house prices of 5.5% in December, which lifted the average home’s cost to GBP521,146. This was despite London being behind the rest of the country during the Covid pandemic. Many buyers chose to live in the countryside to avoid the lockdowns and opt for larger homes. )READ MOREThe boomerang effect: London’s housing market is booming, while the countryside searches plummet. READ MORE The boomerang effect: London’s housing market is hotter than the countryside. This is because more people are looking for their first home. This growing demand will be bolstered by a return-to-work and, most importantly, the return of foreign buyers, renters, with these factors continuing the pull London out from the slumbers that it has been in for so long. “Guy Gittins is the chief of Chestertons agency. “2022 feels like a new chapter for many and house hunters are eager to start the new year in a new place. The record-breaking January sales of London’s property market is a strong indicator that the market will continue to experience high activity levels in the second half of the year. While larger homes and homes with more space are still in demand, the market is seeing a steady rise in apartments in central London boroughs. This is especially true for professionals returning to work and looking for a home close by. “Lucy Pendleton is the co-founder and chief executive of James Pendleton estate agents. She said that London is moving through the gears. This has brought it into the slipstream with other regions. It looks like she will regain her title as the region with the highest performance. The 5.5% annual growth, which is on par with inflation, only tells half of the story. There are concerns that the price increases – on par with inflation – are once more crushing first-time buyers’ dreams. Ian Hewett, founder and CEO of The Bearded Mortgage Broker, said: “Over the last year, I’ve seen endless borrowers save and scrimp to get the magic five per cent deposit necessary to buy a shoebox, only to see the property prices go up. The lack of stock is almost cruel. There is intense competition for buyers and prices have risen due to the Stamp Duty holiday. It is difficult to bear the look of pain and anger as first-time home buyers realize they don’t have enough to cover their deposit to achieve their dream of owning a house. The cost of living is affecting lenders’ affordability criteria. Interest rates are on the rise. First-time buyers have hope that the market will stabilize, or even drop, as the base rates rise and more properties are put on the market. First-time buyers are facing a very difficult market right now, which is driving many to existential despair.