A room in London now cost more than a house in North East
By Michal Skýpala
There is no secret that London real estate market is one of the most expensive in the world. The rate of home ownership is plummeting, and the average age at which people become owner-occupiers is rising. The rents are unaffordable for those working at the sharp end of the service sector.
Good news for the possible house owners is that even though house prices in the UK accelerated in September, according to the Office for National Statistics, London recorded the slowest growth in the country.
In the capital, the annual growth slowed to 2.5pc from 2.7pc in August, making it the weakest region; the North West recorded the strongest rate, at 7.3pc, followed by the South West at 6.6pc. Therefore we can see that London housing bubble is slowly bursting as rice of the housing prices is slowing down.
The average house price in the capital was £483,568 in September. The slowing house price numbers are just continuation of the trend witnessed in recent months – stronger growth away from the capital, which had previously experienced booming house prices. The cost of becoming a house owner in London has almost doubled in ten years.
Therefore it seems that prices in London gradually hit the ceiling. Just couple of weeks ago, it was shown that the price of a single room in London is now more than an entire house in the North East, according to an analysis from the Office for National Statistics data that was published in The Telegraph.
From numbers revealed by ONS, in 2016 the price of a house in London per room - i.e. excluding bathrooms, conservatories, kitchens or utility rooms - was £132,926. This is more than the average cost of an entire house in the North East of England, worth £128,000 in July 2016.
