In the 12 months to October 2013 UK residential property prices increased by 5.5%, the highest yearly house price increase since September 2010, according to the latest data from the Office of National Statistics.
This is up from the 3.8% increase in the 12 months to September but price growth does vary regionally. There was year on year growth of 5.7% in England, 2% in Wales, 3.3% in Scotland and 4.8% in Northern Ireland.
The data shows that annual house price increases in England were driven by rises in London of 12%, in the East of England at 4.8% and the West Midlands a4.7%. Excluding London and the South East, UK house prices increased by 3.1% in the 12 months to October 2013.
Those starting out on the housing ladder are paying more. In October 2013, prices paid by first time buyers were 5.9% higher on average than in October 2012. Meanwhile for owner-occupiers, that is existing owners, prices increased by 5.3% for the same period.
On a monthly basis prices increased 1.4% between September and October, continuing the upward trend that has characterised 2013.
According to Peter Rollings, chief executive officer of Marsh & Parsons, the London property market is dancing to a different beat, with 12% annual growth, and prices rising at more than twice the speed of other regions.
‘Prime London continues to be a magnet for both UK and overseas buyers and demand for the best properties remains intense. We have recorded an average of 19 registered buyers per available property, and until levels of supply increase, property will continue to sell quickly, for close to, or for the asking price, and in many cases, in excess of the asking price,’ he said.
David Brown, commercial director of LSL Property Services, pointed out that first time buyers are still having to leap higher than ever before to join the property ladder. ‘Prices are rising even faster for those buying their first home, leaving many unable to get the property they would have hoped for with their hard won deposit and mortgage offer,’ he explained.
‘With inflation finally back on track there’s some relief for household budgets in the run up to Christmas. If other essential bills can remain relatively stable that will be some support for those battling against meagre wage rises and near-zero savings rates,’ said Brown.
‘In the meantime, rents have been rising even more slowly than wider inflation for some time, which is allowing some households to tuck away slightly more each month towards that dream of home ownership,’ he added.