Land Registry reports 1.3% rise in July house prices
According to the Land Registry, house prices rose by 1.3% in July compared with June, putting the average cost of a home at £163,049 in England and Wales.
On an annual basis, the Registry said prices are 2.1% lower.
It must be noted that the Land Registry compiles its data from completed transactions and therefore lags behind other monitors of the housing market but is generally regarded as the most authoritative.
In comparison, the Halifax said UK house prices rose by just 0.3% in July on a monthly basis, while the Nationwide said house prices rose by 0.2% in July.
Meanwhile, according to the Land Registry, the only region in England and Wales to see an increase in its average property value over the last year is London with a rise of 1.3%.
House prices across England and Wales have picked up slightly over recent months but are expected to fall gradually throughout the remainder of 2011 – particularly in light of the uncertainty regarding the economy and the Government’s spending cuts.
In terms of future house prices, a recent report from leading think-tank National Institute of Economic and Social Research (NIESR), predicted UK house prices will fall by 4.5% in 2011, followed by an average 1.5% fall in each of the subsequent four years.
According to the think tank, this year’s decline will reflect the squeeze on household finances resulting from higher taxes and rising inflation, and will be followed by higher borrowing costs coming into play, as monetary policy tightens.
House prices have also fallen over recent times due to lack of demand; first-time buyers in particular are finding it difficult to get a foot on the property ladder unless they have a substantial deposit in order to secure a mortgage.
First-time buyers are a key part to the recovery of the housing market and the flow of new buyers has had a major impact on house prices and activity and is unlikely to improve in the medium-term.