Camden house prices have risen 8 per cent since the Brexit vote
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House prices in Camden rise almost 4 per cent since May, with first time buyers taking out a quarter more mortgages
The average price of a home in Camden is now £833,581 according to the official house price index released today by the Office for National Statistics.
The figures for June 2017 revealed a monthly price increase of 3.82 per cent in the borough, with prices increasing 8.13 per cent in comparison to last year.
A flat in Camden will now cost you £755,185, with terraced, semi-detached and detached homes all coming in over the £1 million mark at £1.3, £1.9 and £2.7 million respectively.
The monthly increase reverses the trend of haphazard decline seen this year. Between January and February, prices decreased 3.6 per cent, with a following decline between March and April of 2.3 per cent. However, prices have been on the up since April, increasing 1.4 per cent in May and in June up almost 4 per cent.
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Buy-to-let activity also increased in June, rising by 3 per cent on both a monthly and annual basis according to the Council of Mortgage Lenders in a report released today. Buy-to-let borrowing reached £3 billion in June, equivalent to 19,700 loans.
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Also released today, the ONS’ Index of private housing rental prices showed that rents in the private sector rose 1.8 per cent in the year to July 2017, unchanged for the fourth month in a row. Rents in the capital increased almost the same amount at 1.5 per cent, an increase of 0.2 per cent on June.
Bubble, bubble is London in trouble?
The average price across London as a whole weighs in at almost half of the Camden average with homes costing £481,556. London’s average price has decreased 0.7 per cent since May, but increased 2.9 per cent since last June.
The figures throw into sharp relief the contrast between London’s most affluent boroughs and the UK as a whole, where the average home costs £223,257, an increase of 4.9 per cent on June 2016, and almost one per cent up on May of this year. The figures reverse the recent downward trend hailed by some as a response to Brexit. England performed particularly well, with growth increasing 5.2 per cent over the year to June 2017.
Last week, the Royal Institute of Chartered Surveyors (RICS) reported that homes with asking prices in the £1 million plus bracket, so familiar in Camden, were failing to shift off the market as supply dwindled and house price growth proved lackadaisical at just 1 per cent. Government figures also revealed that in June, transactions above £40,000 increased annually by 1 per cent, but declined 3.3 per cent from May.
The first cut is the deepest
The CML’s mortgage lending figures for June reported that first time buyer activity increased by over a quarter in comparison to May 2017 and 9 per cent on June the previous year. Borrowing reached £5.9 billion, or 36,000 loans. Home movers reported a similar increase on May at 26 per cent and 0 per cent on a year ago with 36,500 loans.
With flats in Camden costing well over half a million pounds, Owen Woodley, managing director, Post Office Money argued for a pragmatic approach to first time buyers’ needs. He said: “A slower rate of house price growth will no doubt be welcomed by first-time buyers, many of whom are getting stuck saving for a deposit which is always out of reach. House prices remain high and Post Office Money research shows that first-time buyers are taking a flexible approach, widening their net and willing to travel to more affordable hotspots, to make their housing aspirations a reality.”
Jeremy Duncombe, director, Legal & General Mortgage Club, added: “Long-term affordability issues continue to have an impact though. Although house price inflation is at its lowest level in four years and beginning to align with inflation, lack of supply and the barrier of Stamp Duty is still leaving many hopeful first-time buyers facing a mountain to climb.
“Increasing housing supply and addressing the possibility of a Stamp Duty exemption for first and last-time buyers must remain at the top of the Government’s housing agenda.”
A tale of two Brexits
With house price growth flatlining at around 5 per cent, Russell Quirk, founder and CEO of eMoov.co.uk has argued that the property market has remained robust.
He commented: “Ironically it has been those that prophesied the rapture of the UK market that have actually been the most detrimental to it. Those closest to the action such as George Osborne and his outlandish claims of an inevitable 18 per cent crash in house prices have seen an air of uncertainty slow the market, albeit a tiny blip on an otherwise impeccable current medical record for UK property.
“A year on and in contrast to gloomy predictions, an anticipative Schadenfreude even, we see that, in fact, house prices are nearly 5 per cent higher annually, with the monthly decline in growth reversing and the market remaining one of the most robust in the world.
“The attempt by Osborne, Hammond and many others to talk the puff out of the UK economy and its related housing market, were grossly exaggerated and in fact completely wrong.”
Commenting on the CML’s mortgage figures, Jeremy Duncombe agreed: “A year on from the EU referendum, the mortgage market remains stable even in the face of ongoing uncertainty. As these figures show, lending remains buoyant and buyers are mostly undeterred.”
However, buying agent Henry Pryor is more reticent to hail the figures as a signal of the health of the housing market. He said: “Remember, today’s numbers are based on transactions that were agreed at least three months ago, before the ill-judged General Election, prior to the Grenfell Tower fire, to the tensions in Korea and at a time when we were perhaps naively optimistic about the negotiations over Brexit. Since May the market in London has continued to slip as buyers and sellers disagree over prices and estate agents struggle to get them to agree.”
Even so, and despite his caution, Mr Pryor is optimistic:
“The days of being able to name your price are a distant memory, a bit like the English Summer, it seems. The big question for all thinking of selling is whether we will get an Indian Summer and find that the market firms up in September. I’m expecting that it will but then as a professional buyer I’m always opportunistic at this time of year.”