Price rises in London's property market may be less significant in 2015 than they have been in any other year recently, but those living in the capital have remained the most confident about the future of the sector, it has been revealed.
Over the course of 2015, factors such as the changes to stamp duty tax at the end of 2014 have impacted sales in London and have meant that other cities saw faster price rises than the capital. However, according to the House Price Sentiment Index (HPSI) from Knight Frank and Markit Economics, this has not stopped Londoners from feeling confident about how their houses will appreciate in value in years to come.
At the moment, house price sentiment for the future sits at an index reading of 70.3, which is the second highest reading seen at any time this year.
This future sentiment is driven by London, where the index sits at 77.9, followed by the south-east 76.7 and the East of England at 74.5, with the majority of regions expecting to see house price growth across the next 12 months.
This is a reality that has been reinforced by the impressive levels of growth in price seen in December so far. Across the UK, ten of the 11 regions have indicated that prices have risen in the month, which gives them confidence that positive performance will continue into, and throughout, 2016.
Gráinne Gilmore, head of UK residential research at Knight Frank, said: "The localised nature of the housing market is highlighted in the index, with the regional difference between households’ perceptions of house price changes in December at its greatest for nearly 18 months. This regionalised picture is expected to continue next year, with households’ in London expecting the strongest growth in prices in 2016.
"The supply of housing coming onto the market has dipped to record lows in recent months – affecting the ability of families to move up and down the housing ladder. The survey suggests this trend is also set to continue, with a lack of available housing also likely to continue to underpin pricing in many areas."