House Price Inflation Hits 8.5%

The latest figures from the Land Registry have shown that house prices throughout England and Wales are continuing to rise strongly.

The annual increase in house prices have now hit 8.5% after a further 0.2% rise in April, the fastest rise of its kind in over two and a half years since September 2007.

The number of mortgage deals being offered has also increased along with the house prices, with over 2,000 mortgage deals now on offer.  This comes as lenders continue to relax their lending criteria.

At the start of this month, there were 2,191 mortgage deals available to buyers according to the financial information service Moneyfacts.  These deals required deposits of between 0% and 40%.

The amount available at the beginning of June was a 14% rise on the start of May, however over half of these still require a 25% or more, making mortgages for first time buyers still difficult to come by.

"Lenders continue to ease their criteria and average rates still fall as competition for a limited amount of mortgage business gathers pace," said Darren Cook at Moneyfacts.

London has seen the highest price rises over the past year and the average house price in England and Wales now stands at £165,596.

London house prices have seen a rise of 14.8% in the twelve months leading up to the end of April, with them seeing a 1.6% rise in April alone.  The average London home will now set a buyer back £341,487.

The Land Registry said, “While London's annual change mirrored that of England and Wales for quite some time, the capital's growth rate is now overtaking steadily."

House prices in England and Wales are gauged over 10 regions, all of which have seen a rise in house prices over the course of the year.  Yorkshire and Humberside saw the smallest increase at 0.7%.

Meanwhile, sales figures are still relatively sluggish compared with the rise in prices.

HMRC have shown that last month there were 71,000 house sales completed in April, 2,000 less than March.

The sales of houses of the first four months of the year were substantially higher than the same period last year, with a 26% rise.  However, they were still only half the reported levels in the three years previous to that.

Posted at 04:25PM Jun 02, 2010 by Marc Stenton in Mortgages & Housing Market  |  Comments[0]