House prices in London and Cambridge have increased by over £60,000 and £53,000 respectively over the last 12 months, Hometrack’s first UK Cities House Price Index has revealed.
Meanwhile, homes in Glasgow have only added £4,500 to their value on average.
The annual rate of UK house price growth was 9.0% in September, up just 0.1% from August (8.9%). London has driven the recovery in house prices over the last year, but the monthly rate of growth slipped to just 0.4% in September compared with 1.0% at its peak in April, reflecting weaker demand.
Hometrack also compared the average rate of growth over three and 12 months to determine if the underlying rate was accelerating or decelerating. Liverpool and Glasgow outpaced the rest of the UK, albeit from a low base. In contrast, Oxford and London registered growth deceleration pointing to a slow down in price growth.
Richard Donnell, research director at Hometrack, said: “Local economies drive their local housing markets. Cities are the focus for employment and business growth, which in turn creates demand for housing. By focusing on cities, we can get a more accurate picture of the health of the housing market.
“Expectations that strong house price growth in the south of England would ripple out across the country were over-done. While house price growth has increased across all cities in the last year the rate of growth in the majority of cities is below the UK average. There is little evidence of a runaway surge in prices and the rate of growth appears to be moderating.
“On a national level, the overall rate of UK house price growth has been significantly enhanced by London, so we are starting to see a corresponding dip in the rate of growth in the national figures as the rate of growth slows in London.”
