Wimpey sees danger in soaring house prices

The chief executive of one of Britain's biggest housebuilders warned yesterday that soaring property price inflation in London is "not healthy" as the company unveiled a 22 per cent rise in average selling prices in the past year.

Taylor Wimpey's Pete Redfern said that rising values and the company's push into more lucrative territory in London and the South had taken its overall average selling price to £248,900, 22 per cent up on the year.

He said that "around two-thirds" of the price increase came from changes in the mix of its homes, but also that "roughly 6-7 per cent" came from house price inflation. "It ranges from around 4 per cent in our weaker regions to early double-digits in London and the South-east."

But he said the "level of house prices in London isn't healthy from a social [or] political perspective".

Mr Redfern added: "I don't think that 6-7 per cent [price increases] over the course of a year is cause for alarm after four years of stagnation and a 20 per cent fall before. But if we are sitting here in 12 months' time and talking about 6 or 7 per cent, then there might be cause for alarm. It's a cumulative effect."