UK House Prices

The latest land registry figures (report here) show that London House prices are still moderately increasing, up by 1.9% on the previous month and 1.3% on one year ago.  While this is cheering it should be noted that London is now the only area of the country experiencing house price increases, and the economic problems causing the general decline are also going to effect the London market sooner or later.  The increases we see in the London market are being driven by higher end properties and the peculiarities of that market, in particular its international nature. The land registry figures report shows that the price increases are highest in Kensington and Chelsea (10.6% annual increase) and Westminster (6.6% annual increase) and lowest.  Outside central London we find a mixed bag with most borough's reporting a slight increase or decrease year on year.  We also see seasonally adjusted London sales volumes reducing slightly, but the figures clearly show that volumes are down most for low and high end properties, while for middle range properties from £400k-£1,000k the volumes are almost unchanged in the last year.  This shows again the difficulties being faced by first time buyers.  The same goes for higher end properties, so while prices are holding up at the moment the reduction in volume is slightly worrying.  It could be that the shadow of recession is causing investors to think twice about high end London property, in the hope of price reductions to come.