House prices up by a quarter as first-time buyers left 'desperate'

Prices are still rising in Kingston

Prices are still rising in Kingston

First published in News Surrey Comet: Photograph of the Author by , Senior reporter

House prices in Kingston have rocketed by more than a quarter since this time last year, with first-time buyers “desperately” trying to get on the ladder.

Figures released by property website Rightmove show the average house price in the borough is now £851,634 – up from £814,260 last month and from £676,912 last May.

Bank of England boss Mark Carney warned on Sunday that Britain’s booming housing market “posed the biggest risk to financial stability”.

Kingston’s month-on-month rate of price increase, which dipped last month, was 4.6 per cent from April to May.

Gareth King, from Chancellors in Surbiton, who called the market “bonkers” in March, said: “I can’t see it stopping. The first time buyers desperately want to get on the market.

“Even properties that need work at the moment are going for record numbers.”

One two-bed flat off St Mark’s Hill in Surbiton recently sold for 12 per cent over the asking price, Mr King said.

Got a story? Email the newsdesk at newsdesk@surreycomet.co.uk.

Comments (5)

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11:20am Tue 20 May 14

DB says...

This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough.

Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices?

At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit.

I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates.
This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough. Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices? At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit. I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates. DB
  • Score: 3

1:14pm Tue 20 May 14

kingstonpaul says...

DB wrote:
This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough.

Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices?

At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit.

I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates.
You ask "how does that reconcile with current prices?". Well the obvious answer is that it doesn't and it can't. The London market is utterly dysfunctional, which is the point at which government has to intervene.
Higher interest rates will cool demand, higher stamp duty will create a supply-side discincentive, curb the help-to-buy scheme and build more houses. Oh, and reform the whole buying process and get rid of the leeches in the middle.
[quote][p][bold]DB[/bold] wrote: This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough. Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices? At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit. I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates.[/p][/quote]You ask "how does that reconcile with current prices?". Well the obvious answer is that it doesn't and it can't. The London market is utterly dysfunctional, which is the point at which government has to intervene. Higher interest rates will cool demand, higher stamp duty will create a supply-side discincentive, curb the help-to-buy scheme and build more houses. Oh, and reform the whole buying process and get rid of the leeches in the middle. kingstonpaul
  • Score: 2

2:17pm Tue 20 May 14

DB says...

kingstonpaul wrote:
DB wrote: This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough. Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices? At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit. I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates.
You ask "how does that reconcile with current prices?". Well the obvious answer is that it doesn't and it can't. The London market is utterly dysfunctional, which is the point at which government has to intervene. Higher interest rates will cool demand, higher stamp duty will create a supply-side discincentive, curb the help-to-buy scheme and build more houses. Oh, and reform the whole buying process and get rid of the leeches in the middle.
Totally agree with all of that, but the problem so far has been that the government has so far not wanted to intervene. In fact, it has been their Help To Buy and associated schemes that have got us deeper into this mess than we already were when prices should have crashed in 2008.

It has been very convenient for them so far that house prices have been shooting up to deflect interest away from all of the other dire economic indicators that have been coming out, but this will start to become a millstone very quickly if the economy genuinely is recovering this time and they want to raise interest rates etc.
[quote][p][bold]kingstonpaul[/bold] wrote: [quote][p][bold]DB[/bold] wrote: This is a very sad situation. Kingston is a lovely place to live, but it is 'only' a zone 6 outer London borough. Mark Carney and the government seem determined to bring the mortgage market back in to line by only lending 4 times income and this is a good thing, but how does that reconcile with current prices? At £400k to buy a 2 bed flat in a decent part of the borough, a salary of £95k will be required to get a mortgage assuming that you can only borrow 4 times your income and have a 5% deposit. I know there are a lot of high earners about, but I doubt there are enough to keep that going if they withdraw mortgages at 7-8 times annual income and/or put up interest rates.[/p][/quote]You ask "how does that reconcile with current prices?". Well the obvious answer is that it doesn't and it can't. The London market is utterly dysfunctional, which is the point at which government has to intervene. Higher interest rates will cool demand, higher stamp duty will create a supply-side discincentive, curb the help-to-buy scheme and build more houses. Oh, and reform the whole buying process and get rid of the leeches in the middle.[/p][/quote]Totally agree with all of that, but the problem so far has been that the government has so far not wanted to intervene. In fact, it has been their Help To Buy and associated schemes that have got us deeper into this mess than we already were when prices should have crashed in 2008. It has been very convenient for them so far that house prices have been shooting up to deflect interest away from all of the other dire economic indicators that have been coming out, but this will start to become a millstone very quickly if the economy genuinely is recovering this time and they want to raise interest rates etc. DB
  • Score: 3

3:17pm Tue 20 May 14

SteveC1964 says...

Overseas buyers wanting a KT postcode so that they can stand a chance of getting their children into Tiffin's or Kingston Grammar push up the price of property I believe. That or they see propoerty here as a sure-fire investment. In a free market the only thing to do is to relocate away from the borough to somewhere cheaper (maybe overseas) if you can't afford the prices or find a way to afford the prices that are being asked.
Overseas buyers wanting a KT postcode so that they can stand a chance of getting their children into Tiffin's or Kingston Grammar push up the price of property I believe. That or they see propoerty here as a sure-fire investment. In a free market the only thing to do is to relocate away from the borough to somewhere cheaper (maybe overseas) if you can't afford the prices or find a way to afford the prices that are being asked. SteveC1964
  • Score: -1

11:12am Wed 21 May 14

DB says...

SteveC1964 wrote:
Overseas buyers wanting a KT postcode so that they can stand a chance of getting their children into Tiffin's or Kingston Grammar push up the price of property I believe. That or they see propoerty here as a sure-fire investment. In a free market the only thing to do is to relocate away from the borough to somewhere cheaper (maybe overseas) if you can't afford the prices or find a way to afford the prices that are being asked.
I think that is part of it, but the ripple effect from London is a massive factor here.

£1m for a Surbiton semi seems crazy to me, but if you have just pocketed a £700k profit from selling a flat in Fulham, Chiswick or wherever, it probably seems quite cheap.
[quote][p][bold]SteveC1964[/bold] wrote: Overseas buyers wanting a KT postcode so that they can stand a chance of getting their children into Tiffin's or Kingston Grammar push up the price of property I believe. That or they see propoerty here as a sure-fire investment. In a free market the only thing to do is to relocate away from the borough to somewhere cheaper (maybe overseas) if you can't afford the prices or find a way to afford the prices that are being asked.[/p][/quote]I think that is part of it, but the ripple effect from London is a massive factor here. £1m for a Surbiton semi seems crazy to me, but if you have just pocketed a £700k profit from selling a flat in Fulham, Chiswick or wherever, it probably seems quite cheap. DB
  • Score: 3

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