London and South East masking wider market declines

London and South East masking wider market declines

cost of a home

In the 12 months to April 2012 The House Price Index measured by the Office for National Statistics (ONS) rose by 1.4%.

The year on year increase reflected growth of 1.7% in England, which was offset by declines in Wales, Scotland and Northern Ireland of 1.1%, 0.3% and 8.1% respectively.

Annual house price increases in England were driven by a 4.9% rise in London, and increases in the South East and South West of 2.1 and 1.6% respectively. The largest decreases in England, of 1.3%, were recorded in both the North West and in Yorkshire and Humber.

On a seasonally adjusted basis, UK house prices increased by 1.1% between March and April 2012.

Prices of new dwellings rose by 5.1% during the 12 months to April 2012, while the price of pre-owned dwellings increased by 1.1% in the same period.

In April 2012, prices paid by first time buyers were 1.5% higher on average than in April 2011. For owner occupiers (existing owners) prices increased by 1.4% for the same period.

The stamp duty holiday for first time buyers, announced in the Budget 2010, which exempted those buying their first home from stamp duty up to £250,000, ended on 25 March 2012. In March 2012, 43% of houses were bought by first time buyers. This fell to 32% in April, which is back in line with the longer term average. The decrease in the proportion of first time buyers had a differential impact on average house prices in some regions, where they decreased in March and then increased in April 2012.

“The ONS House Price Index shows that more robust property prices in London and the South East are masking significant declines elsewhere in the country, particularly in Wales, Scotland and Northern Ireland,” said Charles Haresnape, managing director of Aldermore Residential Mortgages.

“Uncertainty over house prices is having a dampening effect on the market and is making prospective house buyers nervous about committing to a house move at the moment. A lack of confidence is a key issue and will remain so until consumers feel that house prices have at least stabilised.”