UK house prices have risen pretty much consistently for over five years and are currently hovering around record highs, according to the latest data from lender Nationwide.
During that time the average deposit has also risen and topped £80,000 in December 2015, the highest level since the Mortgage Advice Bureau began collating the data in 2009.
If you consider that these data are averaged across the whole of the UK, then how much higher are prices and deposits in London? Well, Nationwide shows that while the national average house price in the fourth quarter was £197,044, for London the average house price over the same period was more than double at £446,229.
Rental prices have also increased, with London yet again outstripping the rest of the country. The latest data from the Office for National statistics show rents rose 4.1% in London in the 12 months to September 2015. The average residential rental increase across the whole of England over the same period was 2.8%.
A woeful lack of residential housing available in the capital is among the main culprits for these huge discrepancies between London and elsewhere in the UK. It is against this backdrop that the two main London mayoral candidates for the May 2016 election have both put London’s housing agenda firmly at the top of their campaigns.
Labour candidate Sadiq Khan clearly states his disappointment with the shortage of affordable housing in London, both for renters and buyers.
“For too long the Tories have failed to address the housing crisis that’s gripping our city,” Mr. Khan says as he introduces his housing policies. “Too many people are spending too much on rent and are unable to buy their own home. I will deliver more affordable homes, 'first dibs' on those homes for Londoners, and action on rents.”
Among the ways Mr. Khan will do this is by setting up a new team that will be able to fast-track the building of affordable homes for rental and to buy. He has said this is a clear way in which he can tackle the ‘crisis’.
Housing also tops Conservative mayoral candidate Zac Goldsmith’s ‘action plan’. Number one on Mr. Goldsmith’s list is to double the amount of homes built in London to 50,000 per year by 2020.
“There are too many young adults still living in their childhood bedrooms trapped by London’s escalating house prices,” Mr. Goldsmith says in his campaign website. ”Families spending more time commuting than they do with each other.”
There are currently very few, if any reasons for London house price growth to slow or reverse. And, with no plan in place to increase the level of affordable residential housing in the and around the capital, it isn’t hard to see why housing is at the top of both these mayoral candidates’ campaigns.
As to whether or not the eventual victor will stick to their campaign pledges and preside over an increase in house building or affordable rental homes, only time will tell.