Property Wire: UK house prices up 10% in year to November 2014, ONS data shows
Tue 13 Jan 2015
UK house prices increased by 10% in the year to November 2014, down from 10.4% in the previous month, thelatest data from the Office of National Statistics shows.
House price annual inflation was 10.4% in England, 3.1% in Wales, 4.4% in Scotland and 11.7% in NorthernIreland, the data also shows. Overall house prices continue to increase strongly across the majority of the UK, with prices in London againshowing the highest growth. Indeed, house price increases in England were driven by an annual increase in London of 15.3% and to a lesserextent increases in the East at 11.9% and the South East at 10.8%.
Excluding London and the South East, UK house prices increased by 7.1% in the 12 months to November 2014.On a seasonally adjusted basis, average house prices increased by 0.2% between October and November 2014.The index also reveals that in November 2014, prices paid by first time buyers were 11% higher on average thanin November 2013. For owner occupiers (existing owners), prices increased by 9.5% for the same period.
Peter Rollings, chief executive officer of Marsh & Parsons, said that with property price growth slowing it must notbe forgotten that the market has seen a double-digit rise in home values over the past 12 months and this animpressive leap. 'After the exertions of the summer months, this is simply a period of natural re-calibration,restoring a more sustainable pace of price inflation. Growth is still ticking along in the right direction, with asteadier 0.2% climb in the month to November,' he explained.
'The first half of the year is typically the most energetic for the property market, and were already seeingreinvigorated demand in the new year, as more people turn their sights to getting their foot on the property ladderor moving home. Conditions are ripe for buying, with a rise in supply of property for sale, a relaxation in banklending criteria and historically low mortgage rates ensuring less fraught competition for homes,' he added.
Graham Davidson, managing director of Sequre Property Investment, said he was not surprised by the slowingrate of house prices over the course of November. Whilst seasonality can account for some of this slight declinein growth, it was likely that prices in many places in the UK would have to start to slacken at some point. Londonand the South East in particular were bound to experience a slump, as the rate of increase simply could notcontinue, he pointed out.
As we are now less than six months away from a general election, there is some economic and politicaluncertainty within the UK which, coupled with the introduction of Capital Gains Tax for overseas buyers, may beputting off purchases by non-UK buyers and this in turn could have helped cool price rises, he explained.
The prospect of the Bank of Englands new powers announced in October to restrict mortgage lending in order tocool the property market may also be contributing to the markets deceleration. However, London and the SouthEast are still seeing growth meaning they remain unaffordable to many, he added.