On a monthly basis, the average price of a home in England & Wales sets another new record level at £262,291, and for the ninth month in succession, according to the latest house price index from LSL Property Services/Acadata. The average price has increased by £2,500, or 1.0%, during March 2014.
Over the last year, the average house price has risen by a nominal £17,500, or 7.2%. This percentage increase is 4.5% above February’s 12 month RPI of 2.7%, giving home owners a strong ‘feel-good’ factor as their pre-eminent asset rises in value in real terms. This month’s annual increase in prices is the highest since September 2010, when the market was recovering from the 2009 housing crisis. Average house prices are now 26% above the bottom of that trough, which occurred in April 2009, some five years ago.
David Brown, commercial director of LSL Property Services, said: “Average house prices have never been higher, rollicking upwards by £17,500 – or 7.2% over the past twelve months. This marks the highest annual increase since September 2010, when the market had only began to emerge from the depths of despair. Prices are now 26% higher than the bottom of that bleak pit five years ago, in April 2009.
“Equally, a rejuvenated economy, more accessible mortgage market and better employment prospects are underpinning greater confidence among aspiring buyers. For the ninth month in a row average prices have set a new record, a clear sign of the sustained growth that has galvanised a tangible ‘feel-good factor’ among home-owners. Certainly we’re seeing reports of this renewed optimism throughout Reeds Rains and Your Move branches throughout the country.
“However, sales did stall in March as the adverse weather in February took its toll – in contrast to the typically busier spring period we would normally expect. Delays, cancellations and hesitation from buyers in the previous month inevitably resulted in fewer completions in March than usual for this time of year, particularly in the worst hit South-West where sales fell by 5% from February. Even so, total sales nationwide are still 22% ahead of the same month last year.
“On a regional level the relentless property market in the capital continues to fire ahead. Annual price rises in red-hot London have risen twice as fast as any other region – showing the city is operating on a different playing field. But the heat is radiating out through the regions, which are also experiencing house price growth.
“However, without more properties coming to the market we could see a halt on this progress. The bottom line is we simply need more homes, not just to satisfy the growing demand but also to curb prices from rising beyond reach. Particularly in London, where those at the lower end are already facing an uphill struggle. The measures announced by the Chancellor in last month’s budget – funding to unlock housing projects – is the first step, but it will be putting this rhetoric into practice and seeing new homes come to fruition that will be the key.”
