According to the latest LSL/Academetrics index, house prices in England and Wales have stabilised and are on track for an annual increase of 3%. Residential sales in both countries were up 2.5% in August (the highest figure so far this year) and 2.6% year-on-year. The data also revealed a marginal rise of £153 (or 0.1%) in the average price for properties sold in England and Wales in August, as compared with July.
The latest index states that the average house price in England and Wales is currently £226,243.
The North/South divide is reportedly continuing to grow as regional markets show further signs of divergence.
Richard Sexton, director of e.surv, said: “The housing market demonstrated its resilience in August, as prices and sales activity rose, highlighting the underlying demand from buyers. However, rather than signalling a radical shift in the housing market, the improvement reflects a mini-resurgence following more sluggish buyer activity earlier in the summer, affected by a combination of the Jubilee bank holiday and historically heavy rainfall. While a lack of stock continues to support house prices, it is cash buyers and the equity rich that are providing the impetus for short term improvements in the market.
With wealthier investors playing a pivotal role in the national housing market, there is an increasing divide between the North and South. London, the South East and the South West – where there are greater concentrations of wealthier buyers – are the key driving forces at present and are seeing the fastest rate of annual price growth. Even within cities, local markets are running at completely different paces. In London for instance, Kensington & Chelsea is seeing five times the annual price growth of less affluent boroughs such as Lewisham.”
Peter Williams, chairman of Acadametrics, said: “The average national price statistic is currently looking extremely stable in nominal terms, although monthly stability in house prices is not universal across the country, with areas such as Yorkshire and Humberside witnessing a 1% decline in prices during the month of July.
With little change in prices over the period from September to December 2011 and current stability in the monthly rates in 2012, the likely outcome for annual house price growth at the end of the year is in the range of an increase of 2.5% to 3%.”
Mr Williams pointed out that the LSL/Academetrics House Price Index is at odds with Nationwide and Halifax, both of which have recorded price drops in their latest reports. This is reportedly because the LSL version includes cash sales, which don’t feature in either of the bank’s indices.