Despite house prices in London growing at a slower rate than those in the rest of the UK demand is still on the up for property in the Capital, online estate agent eMoov.co.uk has claimed.
Figures from the Office for National Statistics found that house prices in London grew by just 4.7% in the year to May, significantly slower than the UK average of 5.7%.
This is the second month on the spin that London has underperformed in comparison to the rest of the UK.
But research from eMoov has found that demand for London property has increased for the first time this year, having declined steadily since June 2014.
It found that demand across London’s boroughs has climbed by 7% since March, although it is still down on this time last year.
Russell Quirk, CEO and founder of eMoov, said: “It doesn’t surprise me that despite the market cooling in some of the capitals more prestigious boroughs, house prices in London have continued to rise.
“It’s long been accepted that London is one of the most expensive cities to live in the world, let alone the UK, but now that the average house price has tipped above the half a million mark, it really highlights how out of control the property market has become here.
“The main factor in price growth is always demand and our latest Property Hotspots Index found that of all the London boroughs, demand has increased across the board by 7% on average since March, having steadily declined since this time last year.”
However despite this turn around, demand is still down -15% in London from this point last year.
Quirk continued: “The fact that house prices outside of London and the South East have continued to increase by 5.2%, shows that the London exodus for more affordable property is continuing.
“Hardly surprising given the new London average and the resulting ripple effect, as buyers search for a realistic way to get on the UK property ladder.”