19 Jun

Location is key to house prices, ONS data shows

Location is key to house prices, ONS data shows

Signs of a two-speed UK housing market have been revealed in official statistics on property prices, showing London homes rising fastest in value.

Prices in the capital rose by 4.9% in the year to the end of April, compared with a national average of 1.4%.

There was a fall of 1.3% in prices in the North West of England, and Yorkshire and the Humber, the Office for National Statistics (ONS) said.

Prices continued to plunge in Northern Ireland, down 8.1% over the year.

There were also house price drops of 1.1% in Wales and 0.3% in Scotland over the same period.

Average prices
Geography has always been a key factor in house prices, but relatively low levels of activity have highlighted the significant differences in prices in different parts of the UK.

Annual prices in the UK rose at their fastest rate on average in April than in any month since September.

However, this was driven by the increase in London - where properties continue to attract overseas investment and domestic demand remains relatively high - as well as in the South East and South West of England. These regions saw annual prices go up by 2.1% and 1.6% respectively.

In April, London continued to be the English region with the highest average house price at £388,000. The North East had the lowest average house price at £145,000. London, the South East and the East of England were the only three regions that had prices higher than the UK average price of £229,000.

"If the London property market takes its foot off the pedal even for a second, the national picture will look far less rosy," said Ashley Alexander, managing director of estate agent review website MeetMyAgent.co.uk.

Property price differences can be the result of factors ranging from employment levels to schools "The outlook for the rest of the year is a little foggy. The summer months are historically very quiet as families head off on their holidays, but activity levels could be lower than normal with the Euros and Olympics drawing people to their television sets rather than estate agents' windows.

"Agents will be hoping for an extra lift in September activity to give the property market some momentum for the rest of the year."

Average property prices were £151,000 in Wales, £129,000 in Northern Ireland and £178,000 in Scotland in April, the ONS said.

The survey also highlighted the effect of the closure of the stamp duty concession for first-time buyers at the end of March, which had exempted them from paying the 1% tax on properties bought for up to £250,000.

In March, 43% of the houses sold were bought by first-time buyers, compared with 32% in April, which was more in line with the long-term average.

The house price data is now compiled by the ONS, which took over the task from the Department for Communities and Local Government earlier this year.

SOURCE: BBC NEWS
 

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