Safe as houses? London property price growth will grind to a halt this year
House price growth in London slowed to just 6.4 per cent in January – the lowest level for four years – and experts have predicted growth will grind to a halt at some point this year.
The last time growth was so sluggish in the capital was June 2013, according to Hometrack's data.
Read more: This one graph explains the horrors of London house prices
House prices are rocketing in Bristol and Oxford, however, where house prices grew by 9.7 per cent and 9.2 per cent respectively year-on-year in January. The average house price in Bristol is now £263,200, and in Oxford, it's £430,000.
In terms of house price growth, London is now level with Portsmouth. But, of course, the average house price in the capital is much higher, at £486,600, compared to £221,100 in Portsmouth.
Luxury housing in the centre of the capital has become the biggest drag on growth, Hometrack said, as prices are just becoming unaffordable. In Chelsea, house prices have fallen by more than 10 per cent.
Richard Donnell, insight director at Hometrack, said: "When you consider that house prices in London are 85 per cent higher than they were in 2009, it is not surprising that the pace of increases is slowing toward a standstill as very high house price increases mean affordability is stretched.
"Growth in London has been superseded by larger regional cities such as Manchester, Liverpool and Birmingham."
This graph shows how house price growth in the capital has been outpacing inflation in the rest of the country since 2011:
