House prices soar 17%

13 April 2012

HOUSE prices accelerated in England and Wales in the second quarter of 2004, new Government figures show today.

The Land Registry said the average home value in the second quarter rose 17% compared with a year earlier, up from a 14% year-on-year increase in the first quarter.

A further survey from the Office of the Deputy Prime Minister, which includes Scotland and Northern Ireland, also showed the market gathering pace. Figures based on completion values supplied by 50 lenders put annual house price inflation at 13.9% in June, faster than 12.2% recorded in May. Month-on-month prices rose from £170,719 to £173,756.

The Bank of England's monetary policy committee has raised interest rates five times since November, from a 48-year low of 3.5%, partly to cool the soaring house price boom.

The latest rate rise came on Thursday last week, lifting the bank's base rate to 4.75%, its highest in nearly three years. Afterwards the Bank said that although the housing market was still buoyant, there were signs it was beginning to ease.

However, the Nationwide house price index recently pointed to a pick-up in house price growth in July.

The Land Registry said the average house price in the second quarter was £175,401 in England and Wales and growth continued across all regions.

Top of the list was Middlesborough where values were 59% up on a year ago. A healthy five out of ten of the top ten average price increases were in Wales, where overall average house prices rose by 27.6% in the second quarter of the year.

It was closely followed by the North, and Yorkshire and Humberside where homeowners saw prices rise by 25.8% and 25.6%, respectively.

However, in Reading prices were unchanged during the year, and in Bracknell Forest and Bedfordshire, they rose by just 2% and 4%, respectively.

House price inflation in the south was more restrained, with Greater London recording an increase of 13.7% in the second quarter of the year. This pushed the cost of the average house up from £246,710 to £280,431.

In the South East, the average house price value rose from £194,924 to £213,828, a jump of 9.7%.

The alternative study from the ODPM, which was launched last year in an attempt to create a definitive survey on the property market, said house price inflation slowed in

all the home countries except England where inflation rose from 11% in May to 13.1% in June.

Inflation in Wales and Scotland remained high at 26.1% and 23.8% in June, respectively.

Annual inflation in Northern Ireland remained erratic with a fall from 13.8% in May to 6.4% this month.

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