Government figures say house prices are up

Figures from the Department of Communities and Local Government (DCLG) say that house prices went up by 2% during July, suggesting that the market remained robust despite the interest rate rise early in the month. According to these figures annual house price inflation is now at 12.4%, its highest rate since March 2005. From this source it is the third month in a row that annual growth has gone higher, with the average UK home now worth £218,479.

These figures contrast with others that have suggested recently that the property market has reached its peak. Figures from the Halifax just the week before suggested that prices were only up by 0.4% during August, and Nationwide’s figures suggested a 0.6% increase. Figures from the DLCG do, of course, lag behind the others so their figures may reflect a slowdown in August when those figures are released.

Industry expectations are for house price growth to show a gradual slowdown, with some odd movements seen at times, before settling down again to a period of long-term slow growth.

Northern Ireland continued to exhibit the strongest growth, with an annual rise of 46.8% to the end of July, down from its June figure of 55.9%. With prices now averaging £242,392, the province is now the third most expensive place to buy in the UK, behind London and the South East.

London’s house price growth rate was up again, to 19.1%, from 17.5% in June. In the South East the figure was 11.9%, and it was 11.3% in the South West. In the North East house price inflation was up to 8.5%, taking the average to £151,064, meaning that every region in the UK now has an average house price of over £150,000.

First-time buyers are now paying an average of £167,314, up 13.2% on last year.