19th May 2015
UK house prices increased by 9.6% in the year to March 2015, up from 7.4% in the year to February 2015.
The average UK property price reached £273,000,up from £268,000 the previous month, Office for National Statistics figures show: ONS House Price Index (March)
This is the first increase in the pace of annual UK house price inflation since September 2014.
Scotland saw a dramatic 14.6% annual rise in property prices, the biggest jump since July 2007, taking average prices to £207,000.
The increase was 9.4% in England, 5.7% in Wales, and 7.5% in Northern Ireland.
Average mix-adjusted house prices in March 2015 stood at £284,000 in England, £173,000 in Wales, £145,000 in Northern Ireland and £498,000 in London.
The North East had the lowest average house price at £157,000.
The pace of annual house price growth increased across the majority of the UK.
Lack of supply
Alex Gosling, chief executive of online estate agents HouseSimple.com, says: “Buyer interest has picked up noticeably in the past week. We will have to wait and see if this is just a slingshot effect of the General Election.
“The issue over the past few months has never really been about demand, because the buyers have always been there. It’s supply that is holding the market back, and more activity won’t lead to sales unless the stock shortage is addressed.
“Now the Election is over, the hope is that sellers will have more confidence in market conditions, and there won’t be any reasons for them not to proceed.”
Still good news for the market
Jonathan Hopper, managing director of buying agents Garrington Property Finders, says: “The fact that these strong price gains were driven in part by limited supply shouldn’t detract from the housing market’s achievement.
“This pre-election snapshot shows that house prices in England and Scotland hit record levels in March. While sales volumes were down as many sellers sat on their hands and waited out the result of the election, demand remained constant.
“But since the election the picture has been changing rapidly. The supply of good homes for sale has unblocked as sellers come off the fence, and we’ve returned to a much more free-flowing market.
“Demand is even stronger now the electoral uncertainty is past, and even though supply has improved dramatically there is more than enough momentum to keep driving prices higher.”
Brian Murphy, head of lending at Mortgage Advice Bureau, says: “Existing homeowners will be encouraged by strong annual growth in prices in today’s ONS data, with a 9.6% increase making for significant returns. However, given the fact that it far outstrips wage increases, the higher rate of house price growth brings with it genuine concerns about affordability.
“Certain regions of the UK have seen particularly high growth, with the accelerating rise of house prices in the South-East and East suggesting that the London market is having a ripple effect in other parts of the country. This trend looks likely to continue as people look further out into the commuter belt for good value.”