Liquid error: wrong number of arguments (2 for 1) ONS figures reveal growth in UK house prices is accelerating | Marsh & Parsons Sales and Lettings Estate Agents London

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ONS figures reveal growth in UK house prices is accelerating

Tue 15 Apr 2014

ONS figures reveal growth in UK house prices is accelerating

The growth in UK house prices is accelerating, the ONS claims, as prices rose on average by 9.1% in the year to the end of February, up from 6.8% in the year to January. The rise means that London house prices are now 17.7% ahead of where they were in February last year, although the ONS says house prices are rising across all parts of the UK. Even excluding London and the South East, they are up 5.8% year-on-year. On a seasonally adjusted basis, prices rose 1.9% between January and February. Many commentators claimed that the London market is now effectively operating on its own. Paul Smith, chief executive of the Haart estate agency chain, said data his company had collected suggested that the rise in London was more like 30%. London is another entity and the rest of the country does not reflect these steep rises, he said. Brian Murphy, head of lending at Mortgage Advice Bureau (MAB), added: UK house prices have experienced significant growth in the year to February 2014: however, while prices have clearly risen, the measurement is often skewed by London data. The property market in London has always run by its own rules and is not representative of the country as a whole, so leaving this region out of the equation reveals a far more measured yearly house price increase.

Both Murphy and Smith said the market was likely to be cooling down soon thanks to the introduction of Mortgage Market Review (MMR) regulations later this month. These involve compulsory affordability checks, which will take longer to process. Murphy said: Consumers concerned that they will be priced out of the housing market can be comforted by the fact the Mortgage Market Review (MMR), which comes into play next week, is expected to cool the market and dampen overenthusiastic growth. Mortgage applications are likely to take longer initially as lenders and brokers get to grips with new systems, effectively limiting the number of applications that can be processed. Tighter lending restrictions will mean consumers are only pproved for mortgages after detailed affordability checks, ensuring mortgage borrowing is sustainable in the long-term.

Many were also concerned about the continuing lack of housing supply. Richard Sexton, director of chartered surveying practice e.surv, said: The stock of available property hasnt kept pace, which has driven up the price of first-time buyer properties. If not controlled and addressed, this could in due course start to push first-timers back out of the market place. Help to Buy opened the door to the market for thousands, but the only way to ensure that entry remains open is to upscale construction and build more affordable homes.

However Peter Rollings, chief executive at estate agency chain Marsh & Parsons, said he thought record-breaking prices would encourage more sellers to put their houses on the market this spring, easing the competition among buyers andstabilising market conditions as housing stock is replenished.

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