The housing market in the more desirable areas of London – known as Prime Central London – had a good January, says the latest info from Knight Frank . Prices grew in this area by 1.1%, says the agent, which is the highest rate of growth it has experienced since September last year when the credit crunch took hold.
The market is continuing to slow since last summer, but is proving more resilient than other parts of the market.
‘As this market depends to a very great extent on the strength of the City it is inevitable that the current unease in the financial sector is influencing its slowdown,’ said Liam Bailey head of residential research at Knight Frank.
‘However, it is clear that city money is still being invested in prime central London properties, though perhaps not with the same enthusiasm that followed last year’s bonus round.
‘We are sticking by our forecast of 3% price growth in prime central London in 2008 despite the resilience shown in January. A view endorsed by an emerging belief that the Bank of England’s ability to introduce lower interest rates in the second quarter may be compromised by growing inflationary pressures,’ he continued.