Prime Central London prices rise

Central London saw its prime market house prices growing by 1.1% overall in January, the 10th consecutive month of growth, but the slowest figure since August, according to the latest Knight Frank Prime Central London index.

The annual rate of change is now 11.5%; the top end of the market saw the strongest price growth last month with the £10m+ sector experiencing a rise of 1.5%. House prices in Prime London are now almost halfway between the highest and the lowest points: 15% above the low point in March last year but 12% below the peak reached in March 2008.

Liam Baily from Knight Frank commented: ‘Since April the combined impact of ultra-low interest rates, government stimulus, and rising confidence from buyers - about their own and the economy's prospects - have served to push prices higher, with 15% growth in the ten months to January this year.

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‘As we stand at the beginning of the 2010 spring market, there still seems to be considerable life left in the recovery in pricing. While buyers are back in force, vendors are few and far between, creating a significant imbalance between supply and demand. Slim pickings are the fuel that has been driving this market bounce.'

The report sets out that the outcome of the general election, continuing ‘machinations' over bonuses and the effects of quantitative easing are also determining factors for the future of the market.

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