London property prices prop up UK average: Cebr
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Although the price of a typical UK home rose by 1.7 per cent in the 12 months to September, meaning the average property now costs £233,000, the Office for National Statistics’ monthly house price index suggests this is largely due to London and the south east driving up prices.
Once London and the South east are stripped out, house prices only rose by 0.8 per cent this year. Looking below the surface, the regional picture shows that London is a key driver of the UK housing market.
In London and the South East, house prices continue to rise apace. Over the year to September 2012, house prices rose by 5.2 per cent and 0.7 per cent in the two regions respectively, following earlier increases of 6.3 per cent and 2.3 per cent for the year to August.
Daniel Solomon, economist for the Centre for Economics and Business Research, believes that London house prices have been supported by three factors.
He said: “Asian and Middle Eastern investors have invested their money in London property because of the eurozone crisis and Arab Spring. Secondly, relative to other UK regions, wage growth is robust in London and the south east, supporting the house market.
