House prices rising in every region in England ï¿½ Land Registry
Thu 31 Oct 2013
The Land Registry data showed that even before the government accelerated the second phase of its Help to Buy mortgage guarantee scheme, prices had increased 3.4% in a year on average, and were higher than in September 2012 in all English regions. However, prices in Wales were down by 1.7% year on year and fell by 0.4% in September.
Howard Archer, chief UK economist at IHS Global Insight, said: "There is a mounting danger that house prices could really take off over the coming months, especially if already significantly improving housing market activity and rising buyer interest is lifted appreciably further by the Help to Buy mortgage guarantee scheme, which will take full effect in January."
Overall house prices in England and Wales continued to rise in September, increasing by 1.5% over the month to an average of £167,063, according to the Land Registry. This remained below the peak reached in November 2007, when average prices hit £181,839. There was also a jump in the number of homes sold for more than £1m.
The data, which does not include newbuild homes or those which have not changed hands since 1995 – but unlike other indices does include cash sales – covers the period before the launch of the second part of the government's controversial Help to Buy scheme earlier this month. The scheme gives a taxpayer-backed guarantee to lenders offering 95% mortgages that are open to first-time buyers and home movers on newbuild homes worth up to £600,000. Critics have argued it will further fuel an already rising market.
But the Land Registry showed discrepancies among the regions and within the regions. London's housing market experienced the greatest annual price increase in September, of 9.3%, and while all the English regions showed growth, some boroughs experienced falls. Hartlepool, for instance, recorded the greatest annual price fall, of 9%, while even within London there were variations.
Matthew Pointon, property economist at Capital Economics, said he was still doubtful that the boom in house prices seen in some areas of the capital would spread to other parts of the country. "House prices are already elevated, real earnings are falling and although mortgage lending is beginning to recover, there is no evidence banks are desperate to expand their mortgage books," he said. "That said, by stoking up expectations of a house price boom, the Help to Buy scheme does represent an upside risk to prices. And if prices rise without a surge in mortgage lending, the Bank of England will be less willing, and able, to use their new powers to take the heat out of the market."
The latest snapshot of the market shows that over the past 12 months, prices have increased by 3.4% on average, and are higher than in September 2012 in all English regions. In Wales, however, prices are down by 1.7% year-on-year and fell by 0.4% in September.
The Land Registry figures show that house sales increased by more than 15% in the early summer, with an average of 62,034 a month between April and July, compared with 53,698 in the same period the previous year.
The number of properties sold for more than £1m in July was up by a third on the previous year at 1,143, of which 801 were in London. The imbalance of demand for homes and properties on the market in some areas has been one factor driving up prices, and in London, where there are large numbers of would-be buyers, the Land Registry said prices were up by 9.3% annually and by 1.9% over the month. The monthly rise was larger in the north-east of England, which recorded a 2.7% increase; however, annually prices were up by just 1.3% to an average of £101,262.
In London, the average price of a home is now £393,462, the Land Registry said. However, prices and price inflation range widely across the capital. In Hackney, prices were up by 12.8% year on year, and by 1.2% in September, to an average of £474,202, while in Newham they fell by 2.5% over the year and 0.3% over the month to an average of £225,738. In the UK's most expensive borough, Kensington & Chelsea, prices rose by 7.5% over the past 12 months to an average of £1.16m.
Outside London, prices are still plummeting in some parts of the country. In Hartlepool they dropped by 2.1% over the month and were down 9% on the previous year, to an average of £76,597, while in Torfaen in south Wales prices dropped by 2.8% in September and by 6.9% over the year.
Source; The Guardian
October 2013View older stories >
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