LONDON — UK house price falls for the third consecutive month, as demand for London homes surges.
The Office for National Statistics (ONS) released its housing price index Wednesday, which was up 0.5% from a year ago, and a significant drop for the fourth consecutive month.
In contrast, the value of homes in London, where the market is heavily dominated by foreigners, was up 2.3% year-on-year to $1.36 trillion.
“It’s quite a strong showing from a market that has been pretty stagnant over the last few years,” said John Wetherspoon, an economist at Pantheon Macroeconomics.
London is now the biggest city in the United Kingdom, with a population of about 40 million people.
It has the world’s biggest housing market, and the UK government has promised to spend billions of pounds building more homes in the city.
It has also had a tough time getting new housing built, as it has struggled to build enough homes to meet demand.
House prices have also been squeezed by high property taxes, a levy on the value, and lower wages and inflation.
But the rise in house prices has helped to boost consumer spending in London.
On Tuesday, UK retail sales increased by 0.7% from the same month a year earlier, and consumer spending rose by 2.5%.
Overall, the UK economy expanded at an annualized rate of 3.4% in the second quarter, according to the ONS.
More: More data coming out tomorrow