The average price of a home in London has broken through the £600,000 barrier, and has almost doubled since 2009, according to figures from a leading property firm.

LSL, which owns Your Move and Reeds Rains estate agents, said house prices across England and Wales had risen by 8.9% since April 2015 to an average of £298,030 in March.

The figures, based on analysis of Land Registry data including sales of new-build properties and those paid for in cash, show property values have hit new peaks in nine out of 10 regions. Only in the north-east of England are prices lower than before the downturn. But in London they continued to soar, with the cost of a home up by 11% year-on-year, at £600,625.

In eight London boroughs, prices are double the level they were during the credit crisis in March 2009 . The area with the biggest increase is the east London borough of Waltham Forest, where prices have risen by 113% over seven years. Homes in the area, which includes Walthamstow, cost an average of £430,704.

LSL said the average price of a home in England and Wales was “within a whisker” of £300,000, and had risen by 1% over the month and by 50% over the past seven years.

Adrian Gill, director of Your Move and Reeds Rains, said: “This acceleration in home values comes when many had expected house prices to dip due to a natural decline in demand from buy-to-let and second homebuyers. However, after an exceptional March, there is a severe shortage of properties on the market, with fierce competition between buyers for each available property.”

LSL said there had been 20,000 fewer sales in April, as demand dropped in the weeks after the introduction of higher stamp duty for buyers of second homes and investment properties.



This was supported by the latest monthly survey from the Royal Institution of Chartered Surveyors (Rics), which showed the first fall in demand for more than a year. Rics said a net balance of 22% of surveyors had reported a decline in inquiries from new buyers during the month, and demand rose only in Scotland and East Anglia.

Figures from HMRC showed a big spike in transactions in March, as investors and other second homebuyers brought forward purchases to complete ahead of the new higher rate.

Rics said while the reduced demand from buy-to-let investors and second homebuyers appeared to be the main cause of the fall in new-buyer inquiries, “it may also reflect some uncertainty beginning to enter the market in the run-up to the UK’s referendum on its EU membership”.

But despite the fall in demand, the report said prices were expected to continue to increase. A net balance of 5% more surveyors expected house prices to increase rather than fall in the next three months, while looking ahead over 12 months a balance of 61% of surveyors expect property values to continue to rise.

Gill said the government’s £250,000 cap on starter homes outside London combined with rising prices meant first-time buyers “may soon see a lot less property for their money”, and called on the chancellor to relax planning restriction and increase incentives to sell.

He said some of the more affordable parts of London had experienced some of the steepest increases in house prices annually, as residents look for cheaper properties.

“These kinds of huge hikes in home values in London mean that Sadiq Khan will now face a serious challenge to deliver his promise of increased affordable housing in the city,” Gill said.