Is your house on the fast track?: David Lawson says the recovery is pushing up values to boom levels in some areas

House prices in London are going like a train. That might not seem the most appropriate comparison when the rail network grinds regularly to a halt, yet it is entirely accurate. Some are belting along, others remain stuck in a siding.

The signals went to green last year in large swathes of central London, spurred by big bonuses among City workers and increasing attention from overseas investors. Estate agent Cluttons says that more than half the sales this year have been to foreigners.

This has pushed up values of higher-priced homes in Mayfair, Belgravia, Kensington and St John's Wood by a fifth or more over the past 12 months. But it has not stopped there. The recovery has spilled into Fulham, Battersea and Wandsworth.

'There is a view that property values seen in the boom would not return for many years, said Ian Homersham, joint chairman of agents John D Wood. 'But they have already reached - and passed this level in many areas. The firm has just sold a four-bedroom house in Jubilee Place, Chelsea, for pounds 575,000. The one next door went for pounds 470,000 in early 1989. Another in Smith Terrace fetched pounds 572,000 in June, almost pounds 70,000 more than the price in late 1989.

But what about the rest of us in more 'ordinary prop-erty? According to the Halifax Building Society, the average London home costs pounds 85,500 - or just under pounds 63,500 if you prefer Nationwide's figures.

And therein lies the reason why Londoners have not been dancing in the streets over their good fortune. Average prices across the capital rose by only 4 per cent in the year to June, says the London Research Centre, which breaks down the Halifax figures to boroughs. In fact they were down 5 per cent in Westminster - although there was an 11 per cent jump between April and June.

This throws an air of gloom over owners who feel unable to sell at those prices. Around 80 per cent of buyers who took on homes in the first three months of 1989 still have mortgages bigger than the value of their property, says the centre.

But Yolande Barnes of Savills Research, who first predicted London prices would soar, merely gets angry. 'These reports paint a false picture because they take no account of cash deals and are biased to cheaper homes which take up most mortgages.

Up-market property is roaring ahead, and that has traditionally dragged the rest of us along in its wake. But if gloom is continuously ladled out with a large spoon, the recovery will be pushed back. Confidence is the only bar to revival, she insists.

The Halifax rejects such accusations, pointing out that it tweaks the figures to eliminate bias. The LRC also says it adjusts for different mixes of property used in each survey. But it is not just rich people who are reaping the rewards of recovery.

John D Wood quotes a two-room garden flat in Octavia Street, Battersea, sold for pounds 80,000 in May. An identical one in the next street fetched pounds 79,500 in 1987. A small Battersea semi is on the market for pounds 245,000 compared with a price of pounds 183,000 in 1987, pounds 223,000 in 1990 and a dip back to pounds 195,000 in 1992.

But, in the end, good fortune boils down to where you live and the kind of home. 'Local supply and demand for particular kinds of property are very important, saidTom Tangney, who handled the Octavia Street deal.

Three-bed houses, which probably typify the standard London family home, have been in great demand. This has generally pushed up values, say agents Winkworth.

Again, this varies by area. Prices in Notting Hill, Knightsbridge, Kensington, St John's Wood and the West End have risen between 10 and 15 per cent over the 12 months to July. West London has done almost as well, with Hammersmith, Fulham, Shepherd's Bush and Chiswick coming out 10 per cent ahead and Ealing even higher. Putney, Battersea, Blackheath, Islington, Kentish Town and Finchley are in the same bracket, with Bow and Streatham creeping up behind. But many areas have experienced more modest rises.

East Sheen, Dulwich and Surrey Quays in south London are up only 5 per cent. North of the river Hendon and Highgate are at this level, while Hackney and Golders Green struggled to 3 per cent.

Poor old Catford has seen no change. Its problem is that it lies near a more attractive area, says Winkworth. They just cannot compete for buyers.

But even a 10 per cent rise in Blackheath prices for three-bed homes over the past 12 months has not put them out of reach of buyers who would once have been able to afford only Catford. Most demand here is for four and five-bed homes, where values have risen by 10 per cent.

It all remains thoroughly confusing. Your home could have risen in value by 18 per cent, by 10 per cent or nothing at all, depending whether it is a St John's Wood flat, a Chiswick semi or a Catford house. And small flats are, in many cases, still worth less than they cost because today's first-timers are jumping a step up the ladder directly to two-bed flats.

To misquote the ultimate authority: 'To him that hath shall be given. To him that hath not shall be taken away.

(Photograph omitted)

Discover more property articles at Homes and Property
News
people
News
people And here is why...
News
peopleStella McCartney apologises over controversial Instagram picture
Life and Style
Laid bare: the Good2Go app ensures people have a chance to make their intentions clear about having sex
techCould Good2Go end disputes about sexual consent - without being a passion-killer?
PROMOTED VIDEO
Arts and Entertainment
Kristen Scott Thomas in Electra at the Old Vic
theatreReview: Kristin Scott Thomas is magnificent in a five-star performance of ‘Electra’
News
Destructive discourse: Jewish boys look at anti-Semitic graffiti sprayed on to the walls of the synagogue in March 2006, near Tel Aviv
peopleAt the start of Yom Kippur and with anti-Semitism flourishing, one Jew can no longer ignore his identity
Life and Style
Couples who boast about their relationship have been condemned as the most annoying Facebook users
tech
Arts and Entertainment
Hayley Williams performs with Paramore in New York
musicParamore singer says 'Steal Your Girl' is itself stolen from a New Found Glory hit
News
i100
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Associate Recrutiment Consultant

£18000 - £23000 per annum + Uncapped OTE: SThree: SThree Group have been well ...

Trainee Recruitment Consultant

£18000 - £23000 per annum + OTE: SThree: Real Staffing Group is seeking Traine...

Year 6 Teacher (interventions)

£120 - £140 per day: Randstad Education Leeds: We have an exciting opportunity...

PMLD Teacher

Competitive: Randstad Education Manchester: SEN Teacher urgently required for ...

Day In a Page

Italian couples fake UK divorce scam on an ‘industrial scale’

Welcome to Maidenhead, the divorce capital of... Italy

A look at the the legal tourists who exploited our liberal dissolution rules
Time to stop running: At the start of Yom Kippur and with anti-Semitism flourishing, one Jew can no longer ignore his identity

Time to stop running

At the start of Yom Kippur and with anti-Semitism flourishing, one Jew can no longer ignore his identity
Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

The vintage series has often been criticised for racial stereotyping
An app for the amorous: Could Good2Go end disputes about sexual consent - without being a passion-killer?

An app for the amorous

Could Good2Go end disputes about sexual consent - without being a passion-killer?
Llansanffraid is now Llansantffraid. Welsh town changes its name, but can you spot the difference?

Llansanffraid is now Llansantffraid

Welsh town changes its name, but can you spot the difference?
Charlotte Riley: At the peak of her powers

Charlotte Riley: At the peak of her powers

After a few early missteps with Chekhov, her acting career has taken her to Hollywood. Next up is a role in the BBC’s gangster drama ‘Peaky Blinders’
She's having a laugh: Britain's female comedians have never had it so good

She's having a laugh

Britain's female comedians have never had it so good, says stand-up Natalie Haynes
Sistine Chapel to ‘sing’ with new LED lights designed to bring Michelangelo’s masterpiece out of the shadows

Let there be light

Sistine Chapel to ‘sing’ with new LEDs designed to bring Michelangelo’s masterpiece out of the shadows
Great British Bake Off, semi-final, review: Richard remains the baker to beat

Tensions rise in Bake Off's pastry week

Richard remains the baker to beat as Chetna begins to flake
Paris Fashion Week, spring/summer 2015: Time travel fashion at Louis Vuitton in Paris

A look to the future

It's time travel fashion at Louis Vuitton in Paris
The 10 best bedspreads

The 10 best bedspreads

Before you up the tog count on your duvet, add an extra layer and a room-changing piece to your bed this autumn
Arsenal vs Galatasaray: Five things we learnt from the Emirates

Arsenal vs Galatasaray

Five things we learnt from the Gunners' Champions League victory at the Emirates
Stuart Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

This deal gives England a head-start to prepare for 2019 World Cup, says Chris Hewett
Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

The children orphaned by Ebola...

... then rejected by surviving relatives over fear of infection
Pride: Are censors pandering to homophobia?

Are censors pandering to homophobia?

US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence