Property Wire: Property Prices in England and Wales up 0.1% in October, Land Reg Index says
Fri 28 Nov 2014
Property prices in England and Wales increased by 0.1% in October, taking the average prices to 177,377, according to the latest index from the Land Registry.
The data for October also shows an overall annual price increase of 7.7% but there are considerable regional variations. London has seen the biggest annual price rise at 18.6% and a 0.7% month on month rise, taking the average price to 460,060.
The East experienced the greatest monthly rise with a movement of 1.6% and has seen prices rise by 11% year on year to an average of 198,338, while the South East had an 11.4% year on year rise and monthly growth of 1.2% to an average of 240,070.
The average price in Yorkshire and Humber is now 120,807 after a 0.6% month on month rise and annual growth of 4.3%, the South West has seen prices rise by 0.2% month on month and 6.4% year on year to 185,615 and the West Midlands also saw prices rise 0.2% month on month and an annual rise of 4.4% to 135,378.
The most up to date figures available show that during August 2014 the number of completed house sales in England and Wales increased by 4% to 82,415 compared with 79,587 in August 2013.
The number of properties sold in England and Wlaes for over 1million in August 2014 increased by 15% to 1,363 from 1,185 in August 2013.
Peter Rollings, chief executive officer of Marsh & Parsons, pointed out that while UK house prices are still edging forward, growth is slowing compared to the first half of the year and although London has considerably outperformed all other regions during the last 12 months, growth has slowed considerably and on a monthly basis only edged up slightly.
In addition, prices are slipping in some of the most expensive areas of the capital, with values in Kensington and Chelsea falling 2.5% over the month of October, as growth tails off more sharply at the top end of the market.
'Activity levels at the top tiers of the UK housing market have shown healthy growth, with sales of properties worth over 1million rising 15% in the year to August 2014. But fears of a potential mansion tax could contaminate demand for prime property in the run up to the general election,' he pointed out.
'Uncertainty surrounding this and the possibility of other populist wealth taxes is putting off all buyers be they overseas or home grown, for whom prime London property usually commands global appeal as a gold standard asset. This could be a worrying development for London's reputation as a business hub and natural outlet for investment, and could spell trouble beyond the capital if this lack of confidence at the highest rungs trickles down the housing ladder to the wider market,' he added. While property price growth may now be taking smaller strides on a monthly basis, the housing market has covered extensive ground over the past year, according to David Newnes, director of Your Move and Reeds Rains estate agents, but he pointed out that the headline figures paper over significant regional variations.
'While few traces of the financial crisis are distinguishable in London where boisterous annual price growth continues, for places like Wales and the North East, home owners are still waiting to see evidence of the housing recovery, as property values stall,' he explained.
He also pointed out that the flagship Help to Buy scheme has stimulated the confidence that was required to re-energise the bottom of the market and compared to last year, there is much more choice for new buyers looking to secure a good mortgage, helping them access cheaper monthly repayments and relatively smaller deposits.
'But with uncertainty in earlier months over a base rate rise, and the rate of house prices rises changing, the Government and the Bank of England need to safeguard first time buyer demand,' he said.
'Our research reveals a worrying lack of understanding over new regulation among first time buyers with four in 10 thinking that the recent loan to income caps have made it trickier to get a mortgage compared to six months ago. That's breeding a new air of caution. Any further affordabillity measures need to be outlined more thoroughly, so that they don't numb demand,' he added.