New home prices hold firm in the UK
|Friday, 21 December 2012|
The average price of a new home in the UK increased by 0.2% last month and prices are now 3.2% higher than a year ago, according to the latest index covering the new build sector.
The data from the SmartNewHomes index shows that the price of an average new home is £231,524 but a north/south divide is opening with prices still rising in the bottom half of the country and falling in the north.
Prices of new homes increased the most in November in Wales where they climbed 2.5% to £196,145. But they are still 1.9% below a year ago. Prices also increased in the south west, the south east, greater London, East Anglia and the East Midlands.
In the south west prices climbed 0.9% to £214,537 and they are now 0.2% up on last year. In the south east prices increased by 1.4% to £300,730 and are 8.5% up on November 2011. In greater London they climbed 1.1% on a monthly basis to £412,030 and are 10.9% more than a year ago.
East Anglia saw new home prices rise by 1.7% to £227,981 and are up 8.7% compared with a year ago. Prices increased by 1.4% in the East Midlands to £203,599 and are 8.2% higher than November 2011. And in the north west they increased by 0.5% to £172,029 but are 4.1% down on a year ago.
The biggest monthly fall in new home prices was in Yorkshire and the Humber, down 4.2% compared with September but they are still 1.2% above a year ago with the average price now £178,903. Prices fell by 2% in the north east to £174,608 but are 2.6% above a year ago. They also fell in Scotland, down 0.4% to £227,068 and are 3.1% below a year ago.
Overall the number of new homes coming onto the market is now recovering slowly but the volumes are still significantly short of the number of new homes required to meet demand across the country.
A surge in new homes hitting the market is expected in the New Year with some developers opting to delay the launch of new phases and developments until January 2013.
A rush of pre Christmas demand has boosted prices in November and we expect new home prices to end the year around 3% higher than in December 2011. The Government's £10 billion pledge to build 120,000 new homes will be good news to home buyers who are now finding it easier to finance their purchase through the NewBuy and FirstBuy schemes, said Steven Lees, director of SmartNewHomes.
But he pointed out that there is still a severe lack of new properties on the market. We are hopeful that as the changes to planning policy bed in, with the NPPF becoming applicable to those councils who had local plans in place last year, and a government backed industry taskforce intended to help cut red tape, the number of new homes will increase in 2013, he added.
The latest date from the National House Building Council shows that there were 23,200 homes started in the UK in the three months from September to November 2012, representing a 16.8% decrease compared to the same period last year.
Rolling 12 months figures to the end of November 2012 show 96,150 starts, 11.5% lower than the 12 months to November 2011.
Meanwhile plots under construction now sit at 126,500, 12.1% lower compared to the same time last year.
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