Buyer demand reviving London housing market - research

Demand for property in London is on the rise with a 52% increase in potential house buyers during the first half of this year, according to new research.

There has been a 7.7% increase in the number of new buyers registered on the market and an average of 13 people viewing each house before it sells, according to a survey by Hometrack.

The survey shows that the increase in demand for housing in London had been almost tenfold compared to the growth in the supply of homes for sale, up just 5.6%.

Meanwhile, the average price for a property in the capital has risen by just 0.1% to £274,200, according to the group.

Hometrack said rising sales volumes, a dwindling supply of homes on the market and a continued increase in demand are all helping to underpin prices at their current level nationally.

Estate agents across the country reported a further 5% increase in registrations from potential buyers during June at a time when there was only a 0.8% increase in the number of properties put on the market.

Data on the housing market has been increasingly positive during the past few weeks, with both Halifax and Nationwide reporting house price rises during May, while other indexes have shown rising transaction levels.

Mr Donnell said: "The two key risks for the market are either a renewed weakening in demand or a surge in the volume of housing for sale.

"Given the uncertain outlook for the economy it is the demand side where the greatest risk lies as many would-be buyers continue to remain cautious or are unable to obtain sufficient equity or finance to access the market."

He added: "The lack of housing for sale looks set to remain a continuing theme for the foreseeable future."