House prices up 5.3% in a year as London market reignites with average property now costing £500k
10-30-2015
- Average property price tag in the capital is now £499,997
- House values fell in North East and are now five times lower than London
- Overall, average home now costs £186,553 across England and Wales
By Lee Boyce for Thisismoney.co.uk
September property prices in England and Wales were up 5.3 per cent compared to a year ago - largely led by a revival in 'up and coming' pockets of London, official figures show today.
The Land Registry, which records actual sale prices, said that In the capital values rose 9.6 per cent compared to September 2014, meaning the average property now has a price tag just £3 short of £500,000.
Although house values have continued to go up across London, the rate of growth has been slowing since a peak last summer. At one point, prices were soaring by an annual 20 per cent.
Olympic regeneration: The average price tag of a London property is now just shy of a million pounds. Newham, where the Olmypic stadium is located, saw the strongest annual growth in the capital at 13.6%
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Olympic regeneration: The average price tag of a London property is now just shy of a million pounds. Newham, where the Olmypic stadium is located, saw the strongest annual growth in the capital at 13.6%
As a whole, property prices rose one per cent in September compared to August, according to the figures which lag one month behind other indices.
It brings the average property value to £186,553. All types of home saw prices rise, with detached, semi-detached, terraced and flats all up between 5.2 and 5.6 per cent.
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All regions saw prices rise compared to last year, except the North East, where they have fallen 0.3 per cent to £99,559. It means prices in the capital are now officially five times higher than the North East.
Elsewhere, the South East saw prices rise 8.5 per cent and the East 8.3 per cent. September saw the strongest annual house price inflation since March.
Price surge: Values - especially in the capital - rose sharply compared to a year ago, Land Reg data shows
Howard Archer, chief economist at IHS Global Insight, said: 'Annual house price inflation in England and Wales rose to a six month high of 5.3 per cent in September after dipping to 4.3 per cent in August - the lowest level since November 2013.
'We believe that house prices are likely to see pretty solid increases over the coming months, but will not race ahead.
'We expect house prices to rise by around six per cent in 2016 after a likely similar increase in 2015.'
In terms of specific areas, Reading experienced the greatest annual price increase in September with a movement of 15.3 per cent. It means the average value in the Berkshire town is now £257,842.
Hot pockets: London and the South East continue to have the strongest house price growth
Other areas to record double digit percentage growth are those on the periphery of London, including Luton at 14.2 per cent, Slough at 12.1 per cent and Thurrock at 10.7 per cent.
Much of the new found bumper London growth is found in areas that had previously lagging behind more 'sought-after' central parts.
For example, Barking and Dagenham, Bexley, Enfield, Greenwich, Harrow, Havering, Hillingdon, Newham, Redbridge and Waltham Forest have all recorded double digit percentage growth compared to last year.
Hammersmith and Fulham, on the other hand, was the only London Borough to record a fall, of 0.5 per cent.
In the two areas where average house prices are more than a million pounds – City of Westminster and Kensington and Chelsea – prices were up a slower 2.6 and 2.3 per cent respectively.
Jonathan Adams, director of prime central London estate agency Napier Watt, says: 'The breakdown of transactions by price range is revealing, highlighting a fragmented market in London with higher-value properties struggling to sell.
'There were 288 £2million-plus purchases in July 2015, compared with 370 in the same month last year.
'But in the £1million to £1.5million range the number of transactions rose from 821 in July last year to 840 this year, underlining the impact the increase in stamp duty on purchases over £2million has had on the market.'
In the months April 2015 to July 2015, sales volumes averaged 71,766 transactions per month. This is a decrease from the same period a year earlier, when sales volumes averaged 78,330 per month.
Elsewhere, repossessions continue to fall. Between April and July, there were 519 repossessions per month compared to 932 a year earlier.