House prices were up 0.3% in March, the highest growth since March 2010, according to Hometrack.
It said the impetus for growth came from London where prices rose by 0.7% in the month, the highest increase
in the capital since Feb 2010.
Pricing levels have been improving across the country. House prices were down in only one region – the
North East – compared to January and February when prices were lower in four and three regions
respectively.
The strongest house price growth outside London was seen in the South East (0.2) and East Anglia (0.2).
Prices were up across 23.9% of the country. In London 60% of postcodes saw a price increase in March. Across the rest of England and Wales prices rose across a fifth of postcodes – the highest
number for three years.
Hometrack said supply over the last two months has grown by 13%, but by just 3.5% over the last six. Demand
meanwhile, has risen by 19% in the last two months, slightly lower than the same period in 2012 (22.5%).
The time on the market in London now stands at 4.9 weeks – the lowest level since October 2007
(4.4 weeks). Across the Midlands and Northern regions the time on the market averages11.8 weeks.
In London the proportion of asking price achieved is 95.3% – its highest level since August 2007. In the
South the ratio stands at 94.3% – the highest level since July 2010 when it was 94.4%. Across the rest of
the country the figure stands at around 93%, a level consistent with broadly static prices.
Richard Donnell, director of Research at Hometrack, said: “Compared to a year ago, market conditions have changed. Lower mortgage rates as a result of the government’s Funding for Lending Scheme (FLS) have supported increased activity and demand. The weakening pound and concerns over Cyprus and the Eurozone will only serve to further boost the flow of international funds into the capital.
“High stamp duty costs are likely to result in would-be buyers looking to more affordable outer areas of London
where properties represent better value for money. This is already being seen in the capital where price
growth was strongest in North London compared to central areas where prices posted a below average gain of
0.5%.
“Looking ahead, the continuation of the FLS together with budget initiatives aimed at supporting lending and
demand for new housing, will only serve to support pricing levels. The general improvement in market sentiment on the back of rising prices will be welcomed across the housing industry. However, while scarcity of homes, support for lending and new housing will all act as a support to pricing levels, the problems of affordability and deposit levels still remain serious impediments to a full blown housing market recovery.”