House prices soar in London

| September 18, 2012
House prices soar in London

UK house prices grew at their fastest rate in London in the year to the end of July, according to the latest House Price Index from the Office for National Statistics (ONS).

While house prices increased by 5.7 per cent in the capital, they increased by just 2 per cent in the rest of the UK, a significantly lower increase than the level of inflation.

In Northern Ireland house prices plummeted by nearly 11 per cent during the year, while prices fell by more than 1 per cent in Scotland and by 0.2 per cent in Wales.

Overall, property prices in England grew by 2.4 per cent.

However, excluding London and the South East, prices increased by just 0.6 per cent.

Government schemes, including a £280m extension of the First Buy shared equity scheme, are expected to increase activity in the first-time buyer market.

Property website Rightmove said that the average asking price for a property fell by 0.6 per cent between August and September to £234,858 in England and Wales.

This follows a 1.7 per cent fall in July and a 2.4 per cent fall in August.

The company attributed the weakness in the market during the summer to the effect of the Olympics, with potential buyers staying at home to watch the sport instead of viewing property.

Meanwhile, brokers are more confident about the outlook for the mortgage market, according to research, by BDRC Continental for Halifax Intermediaries.

Seventy per cent of brokers are encouraged by the more competitive mortgage rates being offered over the second quarter of 2012, according to the study.

The number of mortgages approved during the first half of 2012 has increased by 12 per cent compared with the same period last year.

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