London prices grow at over twice the rate of the rest of country

London house prices grew at over twice the rate of the rest of the country in August, according to the Land Registry.

The figures show house prices in London grew at 21.6 per cent year-on-year, from £386,008 to £467,070, in August.

Prices in England and Wales grew 8.4 per cent year-on-year, from £164,116 to £177,824, although this was boosted by London’s exceptional growth.

In the months March to June 2014, sales volumes averaged 71,426 a month, up from 59,556 a year earlier.

E.surv business development director Richard Sexton says: “London is acting like the packhorse for the property market, pulling up prices across the rest of the UK. But direct comparisons are hard – the capital is a different species to the rest of Britain. Many other regions have only just found their legs, and are still moving very slowly.”

But Captial Economics property economist Samuel Tombs believes the market is in for a period of more “modest” growth in the next few months.

He says: “The strong price growth reported by the Land Registry is consistent with earlier reports of large gains from the Nationwide and Halifax. But more recently housing demand has cooled considerably as buyers have baulked at the prices being demanded and mortgage approvals have fallen back. As market conditions ease, a period of more modest house price growth is likely.”