House prices up 2% due to London effect

| November 19, 2012
House prices up 2% due to London effect

Property website Rightmove has reported a 2 per cent increase in property prices year on year, but this is largely due to a rise in the price of luxury homes in London.

The 2 per cent increase in November 2012 compared with the previous year, is the highest annual rate of increase since 2007.

Across England and Wales the average property price increased to £236,761.

However, when London is taken out of the equation, prices rose just
0.2 per cent year-on-year.

Property prices in London were up by 1.2 per cent, with strong demand from overseas buyers, but it was the only area to see an increase.

In North West England prices plummeted by 5.7 per cent to £156,431, and in the South East they fell 4.5 per cent fall to £297,564.

East Anglia saw the smallest fall, with prices down 2 per cent to £225,533.

Rightmove was optimistic about the figures, which will see the market starting 2013 on an upward trend.

Miles Shipside, director and housing market analyst at Rightmove, said: “Outside the capital, agents report prices are broadly flat in many parts of the country compared to a year ago.

“This stability may indicate a sounder springboard for 2013 as the wait goes on for a sustainable recovery in transaction numbers.”

Recent figures from the Council of Mortgage Lenders (CML) also suggest that the housing market could be picking up.

There were 146,500 mortgages advanced for house purchases in the third quarter of the year,13 per cent higher than the previous quarter and similar to the 2011 same period.

The Funding for Lending scheme, launched by the Treasury and the Bank of England, could also boost the housing market in the year ahead.

The scheme makes £60bn available for banks and building societies to borrow, which should increase the flow of lending to householders and small businesses.

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