UK house prices have continued to rise
UK house prices have continued to rise in the last year, driven by a huge leap in the prices of London properties.
The Office for National Statistics found that the average house price had risen 3.1% in the past year to reach £242,000.
It said that these rises had been largely driven by an 8.1% leap in London house prices in the past year. The West Midlands (3.1%) and the South East (2.9%) were the next biggest risers.
If London and the South East are discounted, UK prices rose at 1% in the 12 months to June.
Looking at individual nations, the average English house price rose 3.3% while prices in Wales grew 4.3% year-on-year. However, houses in Northern Ireland continued to struggle, falling 0.4% in the last year, at the same time Scottish prices tumbled 0.9%.
Jonathan Hopper, managing director of property search consultants Garrington, said: ‘Government-backed house buying schemes have aided the recovery, and the new Bank of England Governor Mark Carney’s forward guidance strategy announcement was great news for the property market.
“A promise not to raise interest rates until unemployment levels fall below 7% will give the property market another huge boost of confidence.
“This should hopefully feed through to improved mortgage availability and lower rates across the board as lenders compete more aggressively for customers.
Ben Thompson, managing director of Legal & General Mortgage Club, said: “All the recent data suggests there is a resurgence underway in the housing market and increases in prices and transactions are obviously positive indicators. The last few years has seen a lag in values in many parts of the country as the market worked its way through the crisis.
“So, while steady gradual growth in house prices and increased transactions are a good thing it’s important that price inflation does not gallop ahead in places like London and the South East. If that were to happen the net result will be that ordinary borrowers will find themselves priced out and we may see a bubble form which would be bad news for us all.”