An analysis was made of London market house prices by property type, looking at the cost of purchasing an inner London flat and how this compared to the cost of upsizing to a house across each borough of the capital.
According to the data, the current average price for a flat in inner London is a hefty £558,754, climbing as high as £1.144m in Kensington and Chelsea. The cost of a house (detached, semi-detached or terrace), is also far from affordable at an average of £1.137m, climbing to well over £2m in both Camden and Westminster, and north of £2m in Kensington and Chelsea.
No wonder then, that homebuyers in search of more space are forced to look from the inside out in the London market. However, this heightened demand has also driven up prices across the capital’s more peripheral boroughs.
There are currently just two London boroughs left where you can pick up a house for less than the cost of an inner London flat, down from five boroughs just two years ago.
In Barking and Dagenham the average cost of a house comes in at £499,552 in the current market, £59,202 less than the current average price paid for an inner city flat. In Bexley, a house will cost you £21,416 less than a central London flat in the current market, with the average price currently at £537,338.
This time last year, homebuyers could pick up a house in Havering for an average of £530,128, £8,105 less than the average cost of an inner London flat at the time (£538,233).
Back in 2020, there were a further two boroughs where the average cost of a home was more affordable than a central London flat. In Newham, a house came in £24,690 more affordable, whilst it was £10,151 more affordable to buy a house versus an inner London flat in Croydon.
Marc von Grundherr, Director of Benham and Reeves, commented: “Despite a more lethargic pandemic house price performance, the London market has remained steadfast and property values have continued to climb across the board.
"Whilst looking from the inside out in search of greater affordability is no new trend, the pandemic certainly spurred greater demand for homes across outer London, as buyers placed a greater value on space over convenience.
"However, in doing so, the value of these larger homes has climbed and where you may have found a house for the price of an inner London flat in as many as five boroughs just two years ago, this has now been reduced to just two remaining options.
"Those looking for a larger affordable home are best advised to do so quickly though. The London market is gaining a good head of steam at present and both remaining boroughs are becoming increasingly more in demand.
"The ongoing regeneration of Barking and Dagenham is sure to drive up property values in the future, whilst Bexley remains a firm favourite, particularly amongst those entering the next stage of life with a growing family.”