The latest LSL Acad England & Wales House Price Index shows a marginal rise of £153 or 0.1% in the average price for properties sold in England & Wales during August, as compared with July.
For the fourth month in succession prices have remained within the £226,000 – £226,250 range, with the August price being just £6 different from that seen in May.
On an annual basis the average house price is 2.6% higher than a year ago.
Academetrics said the likely outcome for annual house price growth at the end of the year is in the range of +2.5% to +3.0%.
“Our index is at odds with both the Nationwide and Halifax indices, both of which are recording price falls,” said Dr Peter Williams, chairman of Acadametrics.
“There is a very simple explanation for this – the LSL Acad HPI includes cash sales, which do not feature in either the Nationwide or Halifax calculations. Given that Greater London is the biggest contributor to rising house prices, and that a significant percentage of these transactions are for cash, particularly at the top end of the market, this is a very important factor driving the LSL Acad index.
“The upward pressure on London’s house prices which is being identified by our index, but not by the lender indices, has a knock-on effect on the reported price movements for England & Wales as a whole. This raises big questions about the way the media report price trends and how consumers understand the information provided – all too often the different measures are reported as if they are the same, whereas in reality they are very different. We will continue to raise issues about this matter.”
Richard Sexton, director of e.surv, added: “The housing market demonstrated its resilience in August, as both house prices and sales activity rose, highlighting the underlying demand from buyers. In place of the usual seasonal slowdown, transactions bounced back by 2.5% in August.
“However, rather than signaling a radical shift in the housing market, the improvement reflects a mini-resurgence following more sluggish buyer activity earlier in the summer, affected by a combination of the Jubilee bank holiday and historically heavy rainfall. In reality, obtaining a big enough mortgage remains a hurdle for thousands of first-time buyers, despite the government’s NewBuy scheme. While a lack of stock continues to support house prices, it is cash buyers and the equity rich that are providing the impetus for short-term improvements in the market.
“However, it’s not a homogenous picture across England and Wales. With wealthier investors playing a pivotal role in the national housing market, there is an increasing divide between the North and South. London, the South East and the South West – where there are greater concentrations of wealthier buyers – are the key driving forces at present, and are seeing the fastest rate of annual price growth. Even within cities, local markets are running at completely different paces. In London, for instance, Kensington & Chelsea is seeing five times the annual price growth of a less affluent borough such as Lewisham.”
