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House prices 'rising'

26/10/2007

House prices rose slightly in September, according to official data which conflicts with recent surveys which have pointed to a market slowdown.

Property prices in England and Wales went up by 0.4 per cent over the month, according to the Land Registry. That compared to the lower rise of 0.2 per cent recorded for August.

The price of an average property across the country now stands at £183,896, with the cost of a typical London home reaching £354,272 in September.

But while prices in the capital continue to outstrip those in other areas, Yorkshire and the Humber overtook the city as the region with the highest rate of monthly house-price growth in September.

House prices within the region climbed by two per cent last month, while the average price rise recorded within London was 1.3 per cent in September – down from the 1.5 per cent reported for the capital for the previous month.

But the Land Registry data, based on completed sales as opposed to the agreed prices which some commercial property surveys centre on, revealed that the annual rate of house price inflation slowed last month.

House prices in England and Wales climbed by 8.7 per cent in the year to September, down from the 9.4 per cent recorded in August.

In a further sign that the housing market is no longer expanding at such a quick rate the Land Registry revealed that four of the ten regions which feature in its survey recorded a monthly dip in property prices during September.

The largest fall was recorded in the West Midlands, where property prices dropped by 0.7 per cent over the month.

House price surveys previously released by lenders this month have pointed to a slowdown in the housing market, while the British Bankers' Association (BBA) said yesterday that the number of mortgages approved for home purchase fell by 27 per cent in September.

Earlier this month the International Monetary Fund (IMF) also suggested that the UK could suffer a sharp fall in house prices, similar to that experienced in the US.

Analysts suggest that potential housebuyers are beginning to feel the pinch of rising interest rates and the ongoing global credit crunch which has been prompted by increasing default levels in the US sub-prime mortgage market.