A study released last week by Lloyds Bank shows a dramatic rise in house prices in Lewisham over the past two decades – outstripping most other London boroughs.
Back in 1996, the average Lewisham house sold for £62,770, according to the report. Last year that average multiplied by more than six to £439,811.
While most property owners in the borough will welcome the news, it will fan concerns about a chronic shortage of affordable properties for first-time buyers in the city.
In real terms, property affordability has declined steeply in the same time span. Back in 1996, house prices were 2.9 times the average annual earnings (defined in the report as an adult male in full-time employment in the borough).
Last year that price-to-earnings ratio had climbed to 10.4. In other words, houses are now around three and a half times less affordable compared to earnings than they were in 1996.
Relatively, Lewisham remains one of the better value boroughs in London, which has an even higher house price-to-earnings ratio across the city as a whole – 11.6 on average, reaching an eye-watering 20 in Camden.
It is another stark reminder of London’s growing affordable housing crisis. While average house price-to-earnings ratios have risen across the country, much of that has been fuelled by London. Even the most affordable borough on this level, Bexley, saw its property prices increase by 352 per cent in 20 years, with its price-to-earnings ratio rising from 3.5 to 7.4, higher than the national average of 7.2.
In particular, the report highlighted Hackney, which registered the biggest leap in house prices over 20 years of 702 per cent. Its rapid gentrification saw it leapfrog 16 places in the report’s house price league comparing 1996 to 2016.
The only other boroughs to increase their house prices more rapidly than Lewisham were Westminster, Southwark, Waltham Forest and Newham.
You can read the full press release at the Lloyds Bank website.