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House prices in England and Wales increased by 0.8% in November with values climbing across all regions taking the average price to £280,733. The LSL Property Services/Acadata index also shows that annual growth accelerated to 11.3% but it points out that strong growth is buoyed by London and the South East. Excluding them takes the annual growth to 5.7%. But it does mean that the average house price has now exceeded £280,000 for the first time and annual growth is the strongest it has been for almost a decade. However, completed house sales have been squeezed by slow supply. ‘Annual house price growth across England and Wales has more than doubled over the last 12 months, accelerating from 5.4% in November 2013, to 11.3% during the past year,’ said David Newnes, director of Reeds Rains and Your Move estate agents. ‘These figures are spurred on by London and the South East, where the housing recovery has been fast tracked. When these regions are removed from the calculations, a calmer 5.7% annual rise in house prices materialises, the largest divergence on record,’ he explained. ‘After a temporary hiatus at the highest tiers of the property market, growth has rallied again in the capital with values in prime spots such as Kensington and Chelsea, and Hammersmith and Fulham surging 5.3% over the course of the month, hitting new price records along the way,’ he added. He also pointed out that overall, average house prices in London are now 1.9% higher than September, rebounding back from a more moderate 0.8% increase the previous month, and driving annual price rises to 19.7% in the year to October 2014. However, after a solid advance in activity throughout 2014 to date, completed house sales withdrew last month, from a particularly busy October. House sale completions in November also dipped below the level witnessed a year previously. ‘This doesn’t undermine the strength and stability of the growth in activity experienced over the year as a whole in some locations. For instance, completions have jumped 58% in Slough in the last year, propelling an 18.5% increase in average house prices in the area over this time,’ said Newnes. He also explained that the changes to Stamp Duty should also allow activity to build further at the bottom rungs of the ladder, facilitating hefty savings. ‘This should help erode the upfront barriers of purchasing a home for the significant majority of buyers and sellers may feel the benefit of weightier demand, as well as being able to price their homes more realistically, without having to tactically negotiate threshold barriers,’ Newnes said. ‘Meanwhile, the impact on the top end of the market isn’t as black and white as it may seem at first glance with properties ranging between £1 million and £1,125,000 liable for less stamp duty than before although above that there are no winners,’ he added. ‘In the year to September 2014, some 69% of completed house sales on properties worth £1,125,000 or more were in London, and a… Continue reading →
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