London house prices overvalued by 50%

The London property market is overvalued by as much as 50%, analysts have warned, prompting fears of an impending correction. S&P Global, part of Standard & Poor's, used long-term average prices of properties and compared them with income data for its calculations. Alastair Bigley, a researcher for the agency, warned that prices were likely to fall. “A combination of low rates, the stamp duty holiday and excess savings amid the pandemic have driven property prices higher, particularly in London and the South East where overvaluation relative to income over the long-term is as much as 50%,” he said. “We expect a greater correction in property prices in an overvalued market.” Outside the capital, S&P estimated that property was overvalued by 20%. Mr Bigley said that house price rises were “a consistent trend” across the pandemic, which was not initially noticed due to the disruption to the international economy. 

The Daily Telegraph (21/03/2022)