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Recent data is showing house price growth in the UK has been cooling but the latest index report suggests there is considerable momentum, especially in the South where demand remains high. However, prices are not rising as quickly as they were, according to Home.co.uk’s latest Asking Price Index, and supply is rising. Asking prices increased in September by 0.6%, the ninth consecutive monthly rise, taking the average annual appreciation in England and Wales to 8.5%. But overall the market is cooling and vendors’ expectations are being moderated outside of the current hotspots of London and the South East. The total number of properties on the market that have been reduced in price has risen in recent months to a two year high and now represents 13% of the total stock of property for sale. Moreover supply is growing across the UK as vendors are being encouraged by rising prices. Last month, 10% more properties entered the market than in September 2013. The rise in supply in London is much more extreme, up 49% by the same measure. A breakdown of the figures show that home prices rose across most of mainland UK over the last month but slipped in the North East, North West and Wales by 0.1%, 0.1% and 0.4% respectively. However the firm says that this is consistent with the normal seasonal price variations. Asking prices increased significantly in the more vigorous southern regions. Asking prices in East Anglia, where supply remains very tight, jumped 1.1% over the last month, and prices look set to keep rising as long as the shortage of property for sale continues as in this region the monthly rate of new instructions has fallen 70% over the last seven years. London prices also rose by 1.1% following the previous month’s dip and, for the time being, supply is historically low, down 67% compared with September 2007. However, the report points out that this situation is changing rapidly. The number of properties being put up for sale in the London region has soared by 49% over the last 12 months. Looking back further, the data shows that only five of England’s nine regions have prices that are nominally higher than they were in October 2007, whilst home prices in Scotland and Wales remain below those levels. If the effects of inflation are taken into account then only Greater London has shown any real price gains since October 2007. The data also shows that the average mix-adjusted 12 month change in asking prices for England and Wales reached a maximum in June of 9.6% and is steadily falling back. The year on year price trend confirms that average price increases are moderating overall. ‘We expect this trend to continue in 2015 as rising supply will tend to stifle further price rises, as already seen in Greater London,’ said Doug Shephard, Home.co.uk director. ‘Whilst much coverage is given to the best performing property locations, currently Stratford, Stepney, Mill Hill and Canning Town, it is equally important to… Continue reading →
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