Ranked: Which boroughs have seen the biggest property price inflation in the last two decades?

Prime London property prices have risen by 568% - over £1tr - since 2006

The value of London’s private housing stock has risen from £201.8bn in 2006 to a current grand total of £1.27tr, according to some research by Lloyds Bank, with property prices in prime boroughs increasing by an average of 568% over the last 20 years – dramatically outstripping other segments of the market.

Average London house prices from 1996

While prime areas – defined here as Kensington & Chelsea, Westminster and the City – have seen the biggest growth in pure money terms, it’s Hackney that has posted the steepest escalation in prices over the last couple of decades.

The average house price in Hackney has increased £530,700 (702%), from £75,569 in 1996 to £606,269 in 2016. This compares to the average increase of almost 450% for Greater London, and 290% in England and Wales over the same period.

The sharp increase in Hackney has seen it shoot 16 places up the list of house price increases for London boroughs, from 28th in 1996 to 12th in 2016.

Homes in Westminster have seen the next largest increase in average prices over the past 20 years, from £190,438 (1996) to £1,424,388 (2016) – an increase of 648% – followed by Southwark (626%).

Lloyds’ 20 year timeframe and borough-by-borough approach also reveals the real impact of major infrastructure projects on house prices: Olympic regeneration for the 2012 Games, 1999’s Jubilee Line extension, and 1987’s introduction of the Dockland’s Light Railway contributed to booms in the likes of Waltham Forest (617%) and Newham (612%). Expect similar effects from current and planned projects such as Crossrail and the Bakerloo and Northern Line extensions…

The value gap between the capital and the rest of the country has “significantly widened” in since 2006, with London’s market now largely detached from national trends. In 1996, the difference between the average house price in London and the rest of England & Wales was 47% (£33,834); in 2016, that difference climbed to 107% (£299,631), with prime boroughs seeing an even more pronounced decoupling: prices in Kensington & Chelsea, City of Westminster and City of London are now 5.72 times the England and Wales average, in comparison to 3.34 times in 1996.

The best performing London Boroughs

Between 1996 and 2016, 20 boroughs have seen average house prices increase by over £400,000.

Kensington & Chelsea has seen the largest increase in monetary value, where the average house price has grown from £297,768 to £1,857,287 – an increase of £1,559,518 (524%) and equivalent of £6,498 per month. The next best performer is Westminster where the average value has grown by £1,233,949, followed by Camden (£887,658). These three boroughs along with Hammersmith and Fulham have consistently been London’s five most expensive areas over the past 20 years.

In 1996, average house prices were under £100,000 across nearly two thirds (64%) of London’s boroughs – fast forward 20 years and average prices are now more than £500,000 for over half (58%).

The ten most expensive places to live in London remain largely unchanged compared to 1996. The key exceptions are Southwark, which has moved up ten places to ninth spot (and a partial place in most Prime Central maps) and Haringey which moved up two places to tenth. Barnet and Kingston-upon-Thames have dropped out of the top ten.

Property price growth by London Local Authority: 1996 to 2016

Local Authority District Average House Price 1996 P/E Ratio 1996 Average House Price 2016 P/E Ratio 2016 20 Year Change £ 20 Year Change %
Hackney 75,569 3.3 606,269 14.2 530,700 702%
Westminster 190,438 6.1 1,424,388 18.5 1,233,949 648%
Southwark 87,559 3.4 636,040 14.0 548,481 626%
Waltham Forest 60,388 3.1 433,105 11.4 372,718 617%
Newham 50,077 2.4 356,638 10.2 306,561 612%
Lewisham 62,770 2.9 439,811 10.4 377,041 601%
City of London 136,344 n/a 908,759 n/a 772,415 567%
Brent 82,698 3.9 549,704 14.0 467,007 565%
Wandsworth 120,481 5.3 758,034 10.4 637,553 529%
Camden 169,047 6.2 1,056,705 20.0 887,658 525%
Kensington and Chelsea 297,768 3.3 1,857,287 11.2 1,559,518 524%
Lambeth 95,642 3.7 593,542 14.3 497,900 521%
Haringey 102,533 5.1 622,944 14.8 520,411 508%
Hammersmith and Fulham 150,561 5.6 914,478 13.7 763,917 507%
Islington 124,754 4.6 753,673 12.1 628,918 504%
Merton 104,019 3.9 606,295 12.1 502,277 483%
Tower Hamlets 88,672 3.1 513,092 10.0 424,420 479%
Greenwich 76,073 3.6 433,742 9.0 357,670 470%
Ealing 97,605 4.2 549,489 13.2 451,884 463%
Barking and Dagenham 51,628 2.2 285,129 9.1 233,500 452%
Enfield 82,953 3.8 446,322 11.0 363,370 438%
Harrow 94,457 4.0 507,698 11.3 413,241 437%
Barnet 111,203 5.2 595,756 12.2 484,554 436%
Hounslow 92,115 4.0 492,561 12.4 400,446 435%
Richmond upon Thames 150,258 3.8 797,959 11.0 647,701 431%
Redbridge 80,572 3.2 425,028 9.0 344,456 428%
Hillingdon 84,187 3.2 443,599 10.3 359,412 427%
Kingston upon Thames 106,789 4.3 552,473 10.1 445,683 417%
Croydon 75,657 3.6 377,257 8.9 301,600 399%
Bromley 97,554 4.7 481,733 8.1 384,180 394%
Sutton 79,578 3.6 392,297 9.3 312,718 393%
Bexley 69,925 3.3 343,093 7.4 273,168 391%
Havering 79,603 4.2 359,895 7.7 280,292 352%
Prime London 238,632 1,593,913 1,355,281 568%
Inner London 106,590 619,956 513,367 482%
Outer London 89,956 486,043 396,087 440%
London 105,266 3.9 578,381 11.6 473,115 449%
England & Wales 71,433 3.5 278,750 7.2 207,317

290%

Andrew Mason, Lloyds Bank Mortgage Director: “The last 20 years have seen substantial growth in house prices in London, especially in the most affluent areas of the City. The boom years between 1996 and 2008 saw the gap widening between house prices at the top end of the market and those in London’s inner and outer boroughs, creating two distinct markets1 – ‘Prime’ and ‘Mainstream’.

“However, whilst those boroughs at the top end have pulled away considerably from the rest of London and the country in terms of house prices, improved transport links to the city from the outer boroughs and the 2012 Olympic Games has meant that the boroughs directly benefitting from these have seen house price growth outpace the Prime areas in recent years.”