Average house price up 10% to £271k

p14648UK-News-10-1

Published: Tuesday 16th December 2014 by The News Editor

Comments (0)

House prices surged by 10.4% year on year in October to reach £271,000 typically as the pace of growth in values remained strong across the country, according to an official report.

The largest annual increase was seen in London, where prices have lifted by 17.2% to reach £504,000 on average, the Office for National Statistics (ONS) said.

Across the UK, average prices edged up by 0.1% between September and October.

A typical first-time buyer faces paying 12% more for a home than a year ago, the report shows. In October, the average price paid by someone getting on the property ladder was £208,000.

Year-on-year house price growth across the country has been in double digits since May. But in recent months values have been drifting away from a record high set earlier this year, when growing consumer confidence and a widened availability of cheap mortgage deals helped to unleash strong demand into the housing market.

UK house prices peaked at an all-time high of £274,000 in August. Despite signs that the market has been calming down more recently, property values were still 10.9% higher in October this year than they were during their pre-financial crisis peak in 2008.

The report said: “House prices continue to increase strongly across the UK.”

Some estate agents have predicted that the housing market could be set for a fresh uplift in the new year as the effects of the recent overhaul of stamp duty announced in the Autumn Statement kick in. The change means that stamp duty will be cut for 98% of people who are liable to pay it.

Property values have typically increased year on year by 10.8% in England to reach £283,000, by 5.7% in Wales to reach £172,000, by 4.9% in Scotland to reach £194,000 and by 4.9% in Northern Ireland to reach £137,000, according to the ONS figures.

The North East recorded the lowest annual house price growth across the regions, at 3.9%. The North East also had the lowest average house price of the regions, at £152,000.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “With UK house prices rising 10.4% over the 12 months to October, there is still momentum in the market although it is definitely slowing.”

He described the 12.0% increase in prices paid by first-time buyers over the last year as “worrying”, although he also pointed out that stricter mortgage lending rules came into force in April which force lenders to carry out more thorough checks to make sure that people are not taking on unaffordable mortgage debt.

With expectations over exactly when the Bank of England base rate will start moving up from its historic 0.5% low having been pushed back in recent months, many lenders are currently offering some of their lowest ever mortgage rates.

Mr Harris cautioned that swap rates, which are used by lenders to price their home loans, have “edged up a little in recent days”.

But he continued: “C ompetitiveness among lenders will determine a lot of mortgage pricing next year. If lenders want to drum up business, they will compete on rate and there will continue to be some excellent deals for borrowers to choose from.”

Published: Tuesday 16th December 2014 by The News Editor

Comments (0)

Local business search