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TODAY'S OTHER NEWS

Average London property hits nearly £500,000

The average London house price has leapt 9.6% in a year to £499,997 as the capital's market springs back to life.

This reverses the recent slowdown in London, which has seen a sharp fall in sales of £1 million houses.

The average house price in England and Wales now stands at £186,553, a year-on-year increase of 5.3%, according to the Land Registry House Price Index for October.

September has prices rose 1% in England and Wales, but 1.8% in London.

In the North East, prices fell 0.3% over the past year.

But sales volumes fell sharply between April and July, with an average of 71,766 transactions per month, down from 78,330 a month in the same period last year.

Brian Murphy, head of lending at brokers Mortgage Advice Bureau (MAB), said house price growth has moderated since last year, although the capital has been outperforming strongly.

“Improved mortgage affordability is helping to counter concerns about rising house prices. However, borrowers are very aware that today’s rates won’t last forever."

Stephen Smith, director, Legal & General Mortgage Club & Housing, said the greater availability of mortgages due to low rates, low inflation and increasing wages has stimulated demand.

“This would be good news if there were enough housing available for people to buy, unfortunately, however, this is not the case.

“The lack of properties coming on to the market is making the process of buying a home more competitive, which is in turn pushing up prices beyond the level of inflation and limiting the amount of choice for those looking to buy.”

Smith said that ramping up supply would also help second steppers, as well as first-time buyers trying to get on the property ladder.

Jonathan Adams, director of prime central London estate agency Napier Watt, said a fall in the number of property transactions suggests that the market isn't as healthy as it could be.

“The breakdown of transactions by price range is revealing, highlighting a fragmented market in London with higher-value properties struggling to sell.

“There were 288 £2m-plus purchases in July 2015, compared with 370 in the same month last year.

“But in the £1m to £1.5m range the number of transactions rose from 821 in July last year to 840 this year, underlining the impact the increase in stamp duty on purchases over £2m has had on the market.”

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