New research from comparison site Gocompare.com has highlighted the disproportionate growth in the London housing market when compared to the rest of the UK since the last general election in May 2010.
Under the Conservative-led coalition, average house prices in the capital have risen by a staggering £103,323, on average, from £331,711 in 2010, to £435,034 this year. This means purchasing a property in London four years ago is the equivalent of having a second income of £25,830.
However, the figures show that the story isn’t the same across the entire country, as only five of the nine regions of England and Wales enjoyed any rise whatsoever over the four year period. The house price data also shows that the North/South divide is alive and well, as the North West, North East, Wales and Yorks & Humber regions all experienced a drop in house prices.
Though London house prices have risen by a staggering 31.15%, excluding the capital the rest of England and Wales only saw a rise of 0.16%, or £217.38, on average. Of the other regions, the South East experienced the most growth with a 7.8% (£16,384) rise in property values, which is still nearly four times lower than the boom enjoyed in London.
Conversely, the North East suffered the biggest drop in house prices as values fell by 8% from £107,717 in 2010 to £99,001 in 2014, an average slump of £8,716.
Matt Sanders mortgage spokesperson at Gocompare.com commented, ‘It’s no secret that London is a particularly expensive place to live, however the difference between house price rises in the capital when compared with the rest of England and Wales really does lend weight to the phrase ‘London prices’.
‘These figures will do little to comfort Londoners looking to get on the property ladder. However, those in other areas of the country should be reassured that despite talk of rising house prices across the UK, outside of the capital, there hasn’t been a big change in the affordability of property. And even with the recent tightening of mortgage lending rules, with low interest rates and competitive mortgage deals available it’s still very much a buyer’s market.
‘With the European elections behind us and British political parties now focusing on next year’s general election, balancing the housing market and preventing a London bubble, must surely be a key issue.’
For people overwhelmed by mortgages, Gocompare.com has a collection of mortgage guides available on their website, including guides for first time buyers and information regarding the government’s Help to Buy scheme.