London homes distort prices

Rapidly rising London house prices are distorting the nation's property market, according to new figures released today.

Independent property research firm Hometrack said house prices were growing at their fastest level for two years – but a lack of homes for sale and robust demand in the capital was driving the mini-boom.

The Hometrack study for October showed that the cost of the average home grew by almost £700, or 0.4%, during the month to reach £168,600. The value of London homes rose by almost 1% during the month, leaving the average property costing £287,600 - £2,560 more than in September.

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