Property prices in some central London boroughs have increased by more than 40 per cent over the past five years, according to a survey.
The LSL Property Services and Acadametrics House Price Index found the average price of a house in central London has gone from £344,664 in April 2007 to £398,844 in the same month this year – a rise of 15.7 per cent.
Prices across England and Wales as a whole went up by just 0.3 per cent over the same period, the report said.
But the dearest central London boroughs have experienced the most dramatic increases.
Average prices in Kensington and Chelsea have gone up from £962,086 to £1,368,957 across the five years, a rise of 42.3 per cent, while properties in the City of Westminster increased by 47.2 per cent from £621,790 to £914,975.
Other London boroughs also had significant rises over the same period, such as Camden (up 37.9 per cent), Hammersmith and Fulham (up 30.6 per cent) and Islington (up 21 per cent).
MyLondonHome.com managing director Steven Herd was unsurprised by the report’s findings as his company has carried out research which came to similar conclusions.
“We have done some comparable research that shows even in 2008 when most of the country was seeing falls some central areas of London went up by 10 per cent,” said Herd.
“I think it is a similar picture across zone one, at the heart of central London. This is not something that is just happening in Kensington and Chelsea and those postcodes that are always so well reported. We are seeing it in the Southbank area and other areas that are popular with overseas visitors.”
Herd said property prices in St George Wharf in Vauxhall had gone up from around £700 per sq ft in early 2010 to reach £900 or even £1,000 per sq ft of late.
But even though the price rises have been staggering, Herd still believes the increases in the London market are sustainable.
He said: “It is sustainable because we are seeing gradual increases over a long period. This is not necessarily boom behaviour.
“When we have seen boom behaviour in the past we have seen prices go up 20 per cent or 30 per cent over a couple of months and then you get the inevitable bust. What we are seeing here is happening over a couple of years.
“As I said before, it is all about safety. The volatility of stock markets for UK investors is why we see people invest in property.”
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