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Underperforming, but not by much

While London house price growth and transactions volumes have underperformed their national equivalents over the past year, they have been robust in absolute terms. Indeed, the peak in house price growth of 6.7% y/y in November 2020 marked a four-year high. Even in boroughs where house prices benefit most from proximity to offices, such as Westminster and Tower hamlets (Canary Wharf), falls have been modest. And prices in other central boroughs have risen despite the likelihood of more regular remote working in the future. In contrast, rents have dropped sharply, but there are signs that rental demand has recently started to recover.

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