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Property prices up 0.5% in England and Wales last month says Land Registry
Average property prices in England and Wales increased by 0.5% in February and are up 6.5% year on year, according to the latest index from the Land Registry. This takes the average house price in England and Wales to £180,252 but sales have slowed. From September 2013 to December 2013 there was an average of 77,174 sales per month. In the same months a year later, the figure was 75,553. In London prices increased 0.6% and are up 13.1% year on year. The average price of property in the capital is £463,872, the data also shows. The North West saw the lowest annual price growth 0.7% and the North East experienced the greatest monthly price rise with a movement of 6.2%. The North West also saw the largest monthly decrease with a fall of 1.7%. On a local authority basis Bracknell Forest experienced the greatest annual price increase in February with a rise of 14.5% and Gwynedd saw the greatest annual price fall with a fall of 3.6%. County by county Ceredigion experienced the strongest monthly growth with an increase of 4.6% and Torfaen saw the most significant monthly price fall with a fall of 2.6%. Four counties and unitary authorities saw no monthly price change. The metropolitan district with the largest annual price increase is Salford rising by 11.7% while Newcastle upon Tyne experienced the highest monthly price rise, with an increase of 2.7%. Bolton saw the greatest annual price fall with a movement of 2% and Sandwell saw the greatest monthly price fall with a decline of 2.6%. In London the borough with the highest annual price rise is Newham with an increase of 21.4% and Brent experienced the highest monthly increase with a rise of 1.9%. Kensington and Chelsea saw the lowest annual growth of 7.8% and Hackney had the greatest monthly fall with a decline of 1.5%. The index also shows that price index volatility is greater in areas where recorded sales volumes are low. Index volatility leads to erratic and high changes in reported price. Some of the areas that typically have very low transaction volumes include City of London, Rutland, the Isle of Anglesey, Merthyr Tydfil, Blaenau Gwent, Ceredigion and Torfaen. The number of properties sold in England and Wales for over £1 million in December 2014 decreased by 4% to 929 from 967 in December 2013 and the number of properties sold in London for over £1 million in December 2014 decreased by 6% to 621 from 622 in December 2013. David Whittaker, managing director of Mortgages for Business, believes that the index shows that there is a serious lack of supply. ‘That raises the continual spectre of many households being priced out of homeownership, and puts the spotlight clearly on the private rented sector,’ he said. ‘The longer the housing shortage continues, the more it will be left up to Britain’s landlords to fill the gap. As we approach a general election it will be particularly interesting… Continue reading
Home affordability in UK cities deteriorates to 2009 levels
The past year has seen a deterioration in affordability in UK cities, driven by rising house prices across the country, with Oxford names as the least affordable. Stirling in the most affordable and Aberdeen as seen the highest house price growth since 2005, according to the latest Lloyds Bank Affordable Cities Review. The average UK city house price has risen by 7%, from £181,667 in 2014 to £195,107 in 2015 and this has resulted in affordability in the nation’s cities worsening in the last 12 months from 5.8 to 6.1 times gross average annual earnings, the second successive annual decline in affordability. Affordability in UK cities is, on average, now at the same level as in 2009 but is 15% lower than the peak of 7.2 times earnings in 2008 at the height of the last housing market boom. The overall improvement in affordability across UK cities as a whole over the past seven years has been caused by a combination of an average house price decline of 6% and an increase in the gross average annual earnings in UK cities of 11%. Oxford’s average house price is 11 times the gross average earnings in the city. At an average price of £361,469, houses in Oxford are more expensive compared with local average earnings than any other UK city. This is partly due to Oxford’s attractiveness to commuters working in London. Winchester at 10.11, Cambridge at 9.76, Chichester at 9.19 and Brighton and Hove at 9.10 make up the top five least affordable cities. Greater London is not far behind with average property prices 8.75 times average gross annual earnings. This average figure disguises considerable variations across the capital with central boroughs being significantly less affordable than the Greater London average. The data also shows that Lichfield at 6.95, York at 6.83 and Leicester at 6.54 are the least affordable cities outside southern England. Stirling remains the UK’s most affordable city despite a deterioration in affordability over the past year. The average property price in the Scottish city of £158,645 is 3.9 times gross average annual earnings. Four of the 10 most affordable UK cities are in Northern Ireland due primarily to the relatively low house prices in the country with Londonderry at 3.92, Belfast at 4.49, Newry at 4.51 and Lisburn at 4.63. The most affordable cities in England are Lancaster at 4.03 and Bradford at 4.17. ‘House price rises in the past two years have resulted in a deterioration in home affordability in the majority of UK cities, and generally widening the north/south affordability divide as the market has been strongest in the south,’ said Andy Hulme, Lloyds Bank mortgages director. ‘The UK’s most successful cities economically have tended to see the strongest property price rises. Aberdeen, the country’s oil and gas capital, has recorded the biggest gains over the past decade whilst London has been the top performer during the economic recovery,’ he added. An analysis reveals a significant north/south divide in city… Continue reading
House price growth in UK cities continues to fall, latest index shows
The rate of house price inflation in UK cities continues to slow with growth of 10% in the 12 months to February compared to 11.6% six months ago, the latest data shows. But there is considerable regional variation with house price growth ranging from 3.6% in Newcastle to 12.9% in London, according to the Cities House Price Index from residential analysts Hometrack. The highest growth cities in the last quarter were Glasgow and Liverpool, but average values remain 13% and 15% below their 2007 peak. While house price growth in high value cities such as London, Oxford and Cambridge continues to slow, lower value cities registered a sharp uplift in transaction volumes in 2014 as demand for housing grows, which suggests there is substance to the recent pick-up in house price growth. Rising transaction volumes are an important precursor to house price inflation. The 15% to 35% uplift in transactions in 2014 indicates the most significant recovery in house market activity in cities outside of the South East of England since 2007. Belfast, Leeds, Liverpool and Cardiff all registered a 20% to 39% growth in sales volumes in 2014 compared to the average for the previous five years. Rising demand and increased market activity have resulted in increased house price inflation, which is running at between 5% and 8%. In contrast, double digit house price to earnings ratios in the higher value cities in the South East of England are impacting demand. Growth in housing transactions in 2014 compared to their five year average was well below average. Sales volumes were down in all the high growth cities over 2014 compared to 2013, specifically falling 13% in Cambridge, 7% in Aberdeen, 2% in Oxford and 1% in London. Lower sales volumes are feeding into a slower rate of house price growth in these cities, the index report says. It also says that falling sales volumes combined with a general slowdown in activity in the run up to the general election are resulting in lower mortgage approvals for home purchase. Home owners using a mortgage to buy a home accounted for two thirds of sales in 2014 according to analysis by Hometrack. The remaining third of sales were to cash buyers or those borrowing with a buy to let mortgage, groups who are not subject to mortgage affordability tests. ‘Transactions are a lead indicator for house prices. The acceleration in house price growth in London in the last two years was preceded by three years of rising transactions,’ said Richard Donnell, director of research at Hometrack. ‘A similar pattern is being registered in the cities outside the south of England, as pent-up demand returns to the market supported by low mortgage rates and an improving economic outlook,’ he explained. ‘While the pick-up in activity is welcome news, housing sales in 2014 are still 38% lower than the level seen in 2007 and 10%… Continue reading
