UK property prices barely moving
The figures from the Nationwide show the price of a typical home was unchanged between February and March and is just 0.8% higher on a quarterly basis. While the latest statistics from the Land Registry shows prices have increased by only 1% in the last 12 months. Some experts say they are disappointed that flagship schemes such as Funding for Lending and NewBuy have not had much effect in terms of boosting price growth, while others say that it is encouraging that prices have remained stable in the face of challenging economic circumstances.
The Nationwide data says that the average home is now worth £164,630 and points out that house price growth has now moved into positive territory for the first time since February 2012. However, it is a mixed picture across UK regions with seven out of 13 regions seeing annual price rises in the first quarter of 2013.
London remains the best performing region on an annual basis, with prices at a new record high and Scotland the worst performing. London remains the most expensive region with prices up 4.6% compared with the first quarter of 2012 and the city has seen the greatest recovery in prices of any part of the country with prices now higher than their peak of £306,919 in 2007.
Quote from PropertyCommunity.com : “A new multi billion housing package has been announced in the UK aimed at boosting the struggling residential real estate market. Some £3.5 billion will be made available to help first time buyers get onto the housing ladder
and also others who are struggling to save the large deposits that lenders currently require.”
The Land Registry figures show that average house prices in England and Wales increased by 0.2% in February compared with the previous month and are up 1% year on year. It means that the average house price is now £162,606. In London over the last 12 months prices have increased by 6.3% while on a monthly basis Wales has experienced the greatest monthly rise with a movement of 3.6%. The region with the greatest annual price fall is Yorkshire and The Humber with a decrease of 0.9% and the South West saw the most significant monthly price fall with a decrease of 0.8%.
According to David Newnes, director of LSL Property Services, the housing market is showing remarkable resilience in the face of adverse economic conditions. ‘A sterling performance from house prices in the capital city in particular has given both lenders and prospective buyers greater confidence in the market,’ he said. ‘The rise in house prices annually and monthly indicates the property market is still firmly on the road to recovery. Lower rates and a wider range of mortgages has improved first time buyer lending over the last six months, although it is still some way off returning to the levels seen prior to 2008,’ he pointed out.
He also explained that mortgage lending conditions are still tough. ‘Deposit requirements are still high and criteria to get a mortgage is by no means straight forward, because lenders feel they still need to err on the side of caution. The reality is that the exact opposite is required to stimulate the lower end of the housing market. Tricky borrowing conditions are hampering the number of buyers able to move, a problem that is hampering house sales in some parts of the country,’ he added.
He believes that the government is doing all it can to help jumpstart the mortgage market. New schemes announced earlier this month have the potential to breathe life into the mortgage market and help push first time buyers onto the property ladder and will also boost new house building.
Peter Rollings, chief executive officer of agents Marsh & Parsons, said the figures show that London is regarded as a safe haven for property investments. ‘A relative shortage of stock sees house prices in the capital setting new records according to Nationwide. Demand is coming from both home and abroad and is set to continue with the much anticipated return to more seasonable Spring like weather,’ he explained.