Demand in London has grown three times faster than supply over the last quarter and some of the survey’s key indicators for the city are now back to levels last seen in 2007, says the latest index report from Hometrack.
Outside London, demand rose across all regions for the third month in a row. This follows the same pattern as last year but importantly without the external stimulus of a stamp duty holiday, said the firm.
It points out that a lack of housing for sale is a key feature of the market. For the last three months supply of new housing has failed to keep pace with demand. April saw just a 2.8% increase in new homes coming to the market. This supply/demand imbalance continues to put upward pressure on prices.
The index also shows that time on the market indicator has fallen by almost a week since the beginning of the year from 9.9 weeks in January to 9.1 weeks in April. In London the time on the market is almost half the national rate at 4.6 weeks, a level last seen in October 2007.
The upward pressure on house prices has been limited to areas where the time on the market is above average. Outside London price rises remain below average ranging from a fall of 0.1% in the North East to a rise of 0.2% in Wales. In London average prices grew by 0.7% over April.
In London the proportion of the asking price achieved now stands at over 95%, a level not seen since summer 2007. The ratio is also over 95% in the South East; in all other regions it averages 93%, a level consistent with flat prices.