Agents have reacted angrily to new research from UBS, which says house prices in London are the most overvalued in the world and are in "bubble-risk territory". The bank cites foreign investment, the help-to-buy scheme, "alluring" yields for buy-to-let landlords and ongoing population growth as reasons for recent price hikes - but agents give the same reasons to show what good value London offers.
The UBS Global Real Estate Bubble Index looked at 15 cities around the world and found that London was the least affordable for local property purchasers of any city - bar Hong Kong - and most at risk of prices falling.
London estate agent Jeremy Leaf, a former chairman of the Royal Institution of Chartered Surveyors, says: "There is still a general shortage of the sort of property that people want to buy. Although more property is coming on to the market, much of it is aimed at investors, who understandably are more reluctant to proceed because of higher stamp duty charges."
The inexorable rise in prices means that £1 million houses are now the norm across London and its suburbs. House prices in the three months to March were 10.1 per cent higher than in the same quarter a year earlier, according to the Halifax - but some analysts say the market may now have peaked.
Agent Preston Bennett is asking £1.7 million for a 1,750 sq ft home in Glenthorpe Gardens, at Bentley Priory, Stanmore. The historic estate has been redeveloped as a residential scheme with 57-acre grounds, two tennis courts, a gated entrance, 24-hour security and a concierge. Glenthorpe Gardens offers newly-built houses near the Italian sculpture gardens.
The same estate agent wants £2.25 million for Bramblewood, a detached six-bedroom house in Green Lane, Stanmore, rebuilt eight years ago. Preston Bennett has an art deco style house on the same road for £2.35 million and the Rookery on Stanmore Hill is for sale at an undisclosed price.
A bubble cannot be proved until it bursts, says UBS, "but recurring patterns of property market excesses are observable in the historical data".
