London home sellers shrug off election, raise prices

(iStock)
(iStock)

London - London house prices rebounded in May, rising to a record as buyers and sellers defied the usual trend of holding off on property transactions before an election.

The average asking price in the city rose 2.1% from April to £649 864, property website Rightmove said on Monday, even with the upcoming UK general election on June 8. The annual rate of growth remained subdued at 0.9% following a 1.5% drop last month. That was the biggest annual decline in almost eight years.

“Time will tell how close these sellers get to their asking prices, but the uncertainty associated with an election has not deterred them from trying in increasing numbers and at an increased average price,” said Rightmove Director Miles Shipside.

“New sellers in the capital seem to be showing less hesitancy to come to market than many other homeowners elsewhere in the country.”

London’s property market has under-performed the rest of the country since the start of 2016. As the referendum to leave the European Union, tax increases and unaffordable valuations hit investor demand, more expensive homes have suffered the most.

Asking prices for homes in inner London rose just 0.6% from a year ago, while outer London grew 1.2%, Rightmove said. Its data are not seasonally adjusted.

At the national level, prices rose 1.2% on the month and 3% from a year ago, according to the report. The price of family-sized homes rose the most out of all types over the last 12 months. Rightmove also found that homeowners with children under the age of 11 are twice as likely to be moving.

UK Prime Minister Theresa May unveiled her Conservative Party’s manifesto last week, which contained few surprise policies that might affect the housing market.

While the Tories have held the lead in the polls, the race appears to be tightening. The Tory advantage over Labour has fallen to 9 percentage points from 18 percentage points, according to a Survation survey for Good Morning Britain released Monday.

“Moving pressures are understandably taking priority over electioneering and Brexit worries,” Shipside said.

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