15th September 2015
House prices rose by 5.2% in the UK over the year to July, as the East of England overtook London with the highest growth of 8.3%.
The latest figures from the Office for National Statistics (ONS) show that prices in London, which saw the strongest growth last year, rose by 5.5%, which was slightly below the average in England of 5.6%.
The average house price in the UK reached £282,000 and for first time buyers it was £215,000.
Northern Ireland also saw strong price rises of 7.4% as property values continue to recover from the dramatic falls during the credit crisis. Prices in Northern Ireland are still 42% below the peak of August 2007.
Campbell Robb, chief executive of housing charity Shelter, says: “Not addressing our dramatic shortage of homes is pushing house prices higher and higher, and a stable home further out of reach for millions of young people and families. Instead they’re trapped in expensive and insecure private renting, or stuck in childhood bedrooms.
“Current government schemes like Help to Buy or Starter Homes don’t help the ordinary families on average wages who are struggling to keep up with sky high housing costs. The autumn spending review is the government’s last chance to show they’re serious about turning around the housing crisis, by investing in the genuinely affordable homes we desperately need.”
Rob Weaver, director of property at residential investment platform Property Partner, adds: “Prices nudged up again between June and July and the cause was almost certainly weak supply.
“The supply issue is nothing less than an enigma. Given that properties overall are commanding decent prices, you would expect to see more people selling. Something in the market is broken.
“Even though employment levels are strong, consumer confidence may not be as robust as surveys suggest. Many households are almost certainly wary of not being able to secure a mortgage under the new lending rules, and that could be impacting their intent to move.
“Households have almost certainly become more conservative in the wake of the global financial crisis. Paying debt down has become more appealing than racking it up. Many are doubtless sitting on their hands until the economic picture gets clearer because the recovery has become less definitive during the first half of the year.
“This latest data shows that the property market has become a lot more balanced, with sustainable levels of price growth across a number of regions.
“It is almost a relief to see prices in the capital growing at 5.5%, compared to the high double-digit growth rates of a two years ago.”