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Average asking prices in England and Wales increased by 0.6% in England and Wales in July while in Scotland there was no change month on month, the latest index shows. London prices increased the most, up 1.5% month on month and 12.5% year on year. In England and Wales the annual price growth was 6.2% and in Scotland it was 3.6%, according to the date from Home.co.uk. This takes the average asking price in England and Wales to £281,497 but in London it is £525,145. In Scotland it is £167,680. The data also shows that the supply of property for sale has fallen across the UK, down by 10% year on year and the South East remains the UK’s fastest regional market, with a typical time on market of 61 days. The UK property market continues to enjoy considerable momentum despite talk of mortgage rates rising in the near future, according to Doug Shephard director at Home.co.uk. He pointed out that a combination of buyer demand and short supply is driving prices higher, but at a lesser rate than last year. ‘The supply crisis is becoming more acute, and July recorded the lowest number of properties entering the market for that month since the onset of the financial crisis. Lack of supply is felt most keenly in London and the East of England, where the volumes of properties entering the market are down 23% and 16% respectively,’ said Shepherd. ‘These and other southern regions are clearly sellers' markets and prices are firmly on an upward trajectory. Marketing times in the South East continue to be the lowest in the country. Indeed, across the nation, marketing times are currently around the lowest we have witnessed since 2008,’ he added. He explained that buyer demand coupled with low numbers of properties entering the market has led to a significant reduction in the total stock for sale. The number of properties on the market in England and Wales is 11% lower than in August last year and 39% less than in August 2007. ‘Hence in the southern regions, where supply problems are most acute, buyers have only half the choice that was afforded to them eight years ago. Ultra low interest rates and other stimulus measures have ensured that more money, largely new debt, is chasing ever fewer properties,’ Shephard said. Whilst national supply levels are at an all-time low and trending down, a more detailed regional analysis of supply shows how this key market driver varies across the nation. What is immediately evident is that those regions which have suffered the greatest reductions in supply over the last seven years have also shown the greatest price growth. Shephard pointed out that along with demand, supply is a key market driver with direct consequences for regional property market performance. London shows the biggest contraction in supply over the last eight years, of 69%. ‘For the buyer, this means that whereas before there were, say, 10… Continue reading →
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