A report into the rise in house prices has revealed that the average price for a property in London has rocketed over 3% in a month, this means that the average price for a property in the capital is more than £500,000. Camden has become part of the “Elite Club” along with the likes of Kensington and Chelsea where the average price for a property is now in excess of £1m.
Elsewhere in the kingdom, house prises have also risen by around 9% since the start of 2013 with the average house price now reaching over £245,000. The strongest start to a year since 2004 has been attributed to cheap mortgage deals and the governments funding for lending scheme.
The first signs of the end of the first rally in UK house prices have arrived, data shows house prices have dropped by 1% last month ending a nine month long rally in home values. This data ties in with news from the British Banking Association that mortgage approvals have also dropped to an eight month low.
One of the biggest issues for the UK housing market is not just the availability of mortgages but more importantly the lending criteria. Since the 70?s home buyers have enjoyed lending of 90% and over LTV (loan to value). It is very difficult for first time buyers to raise deposits of 25% that have been required in recent times. The good news is that in the last few months the mortgage market is producing more workable deals with Loan to values hitting 85%. On a ?200,000 pound house that would mean buyers would have ?20,000 less to rise and that is what really makes a difference to the housing market.