End of the £300,000 London home is in sight, experts warn

Homes priced at less than £300,000 are now an “endangered species” in London as huge demand forces up values in the capital’s last affordable neighbourhoods.

The number of wards where prices averaged below the £300,000 mark plummeted from 104 to 40 last year, most of them in the outer fringes of east and south London, according to research.

The analysis by estate agency Savills also shows that for the first time, there were more wards with a price average of over £1 million than there were with under £300,000.

The £300,000 barrier is seen as significant because it represents the outer limit of affordability for a typical London household who have a joint income of about £50,000 and a 25 per cent deposit.

That would still leave them needing to raise a mortgage four and a half times their salary — a multiple that few lenders are prepared to exceed.

Lucian Cook, director of residential research at Savills, said: “The scale and spread of house price growth over the past five years means the £300,000 neighbourhood, though not extinct, has certainly become an endangered species in London. It is symptomatic of the housing affordability issues in the capital.”

Five years ago almost half of London’s 649 wards had an average price below £300,000.

Of the 40 sub-£300,000 areas left, 15 are in Barking and Dagenham, five in Bexley, four in Croydon, three in Havering and the others in Ealing, Merton, Haringey, Enfield, Redbridge, Hillingdon, Hounslow, Greenwich and Newham.

The cheapest ward is Thames in Barking and Dagenham, at an average £228,386 last year.

Charlton Park Lane, SE7 Was: £249,995 (July 2011) Now: £408,000 (Zoopla value)

Markets have stayed strong in many of these once less fashionable areas as buyers and investors shift from expensive central addresses saddled with high stamp duty.

Record low mortgage rates and Government-backed schemes such as Help to Buy have stoked already intense demand.

Gorseway, Romford RM7: Was: £240,000 (July 2013) Now: £368,000

More than half of London boroughs now do not have a single ward with prices below £300,000, with the most dramatic turnaround in Waltham Forest.

Five years ago, 19 of its 20 wards were in sub-£300,000 territory, but last year none were.

The number of wards with prices above £1 million rose slightly from 51 to 52. The most expensive was Knightsbridge and Belgravia in Westminster, at an average of £4.28 million — almost 19 times more than in Thames ward.

Seb Klier, campaign manager at the Generation Rent group, said: “The £300,000 mark is about the maximum a couple who are both earning average salaries, and have managed to save a substantial deposit, could afford in London.

Aveling Close, Purley CR8 Was: £265,000 (October 2014) Now: £336,000 

With unstable, expensive renting the only option for most, the Government must give the Mayor powers to regulate the market properly.”

Paula Higgins, of the HomeOwners Alliance, said: “Without parental support, young Londoners on normal salaries are effectively priced out of over 90 per cent of the capital’s properties.”

Pinner Green, Pinner HA5 Was: £285,000 (August 2012) Now: £432,000

Mayor Sadiq Khan’s deputy for housing, James Murray, said: “The Mayor has been clear that fixing the housing crisis will not happen overnight.

"He is introducing planning measures to boost affordable housing and will use funds secured from Government to build 90,000 affordable homes — two thirds for first-time buyers.”

Roger Harding of housing charity Shelter, said: “It’s crucial he delivers if we are to prevent a generation of Londoners losing all hope of having a place to truly call home."

Wards below £300,000

Ward Borough Ave price 2016
Thames Barking and Dagenham £228,386
Thamesmead East Bexley £236,231
Abbey Barking and Dagenham £244,767
Southall Green Ealing £246,734
Erith Bexley £247,536
Village Barking and Dagenham £251,528
Gascoigne Barking and Dagenham £251,969
Thamesmead Moorings Greenwich £255,689
North End Bexley £256,533
Heathrow Villages Hillingdon £262,208
Belvedere Bexley £268,491
Northumberland Park Haringey £268,906
River Barking and Dagenham £270,048
Crayford Bexley £273,230
Eastbury Barking and Dagenham £274,489
Parsloes Barking and Dagenham £274,786
Heath Barking and Dagenham £275,801
Whalebone Barking and Dagenham £276,291
Fieldway Croydon £276,400
Goresbrook Barking and Dagenham £276,740
Gooshays Havering £278,397
Mayesbrook Barking and Dagenham £280,543
Chadwell Heath Barking and Dagenham £281,041
Becontree Barking and Dagenham £281,948
Feltham West Hounslow £284,875
Glyndon Greenwich £286,040
Alibon Barking and Dagenham £287,556
Selhurst Croydon £288,911
East Ham South Newham £289,668
Broad Green Croydon £290,807
Edmonton Green Enfield £291,609
Little Ilford Newham £292,203
Valence Barking and Dagenham £293,624
Loxford Redbridge £294,895
Brooklands Havering £295,397
Heaton Havering £296,971
Enfield Lock Enfield £297,028
Figge's Marsh Merton £297,613
New Addington Croydon £297,921
Cricket Green Merton £299,469

Most valuable wards

Ward Borough Ave price 2016
Knightsbridge and Belgravia Westminster £4,282,287
Norland Kensington and Chelsea £3,675,564
Marylebone High Street Westminster £2,892,405
Brompton Kensington and Chelsea £2,852,994
Campden Kensington and Chelsea £2,331,995
West End Westminster £2,300,664
Abingdon Kensington and Chelsea £2,296,587
Stanley Kensington and Chelsea £2,225,858
Queen's Gate Kensington and Chelsea £2,201,574
Hans Town Kensington and Chelsea £1,991,277
Royal Hospital Kensington and Chelsea £1,986,381
Pembridge Kensington and Chelsea £1,927,692
Frognal and Fitzjohns Camden £1,923,978
Village (Wimbledon) Merton £1,908,224
St James's Westminster £1,907,929
Holland Kensington and Chelsea £1,760,051
Hampstead Town Camden £1,751,750
Cremorne Kensington and Chelsea £1,723,030
Courtfield Kensington and Chelsea £1,719,630
Regent's Park Camden £1,633,627


Source: Data collated by Savills from Land Registry

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