London home prices go through the roof

London home prices go through the roof

April 12, 2007

LUXURY home prices in London rose at a record monthly pace in March as Russians and Middle Eastern buyers competed for a smaller number of properties with financiers from the City of London.
The average price of London's most expensive houses and apartments rose by an average of 3.1 per cent last month from February, real estate broker Knight Frank said.
The annual increase was 32 per cent, the highest in 28 years.

"The continued strong performance can be explained by supply shortages and ongoing international demand now that City bonus money has been paid out," Liam Bailey, head of residential research at Knight Frank, said.

The average price of a luxury house in Knight Frank's monthly index is now almost pound stg. 5 million ($11.9 million), with apartments costing pound stg. 2.5 million.

A typical house has gained pound stg. 100,000, or about four times the average annual UK wage, in value each month over the past year.

Prime residential property prices in London have now risen for 27 consecutive months.

In the first quarter of 2007 house prices rose by 10 per cent and apartments by 7.5 per cent.

Chelsea, favoured by bankers, and St John's Wood continued to perform well, said Mr Bailey.

Bloomberg