The price changes takes the average house price in England and Wales to £161,605 and the region s which experienced the greatest increase in its average property value over the last 12 months was London, up 7%.
Wales experienced the greatest monthly rise with an increase of 1.5% per cent. The North East experienced the greatest annual price fall with a decrease of 5.8% and the region also saw the most significant monthly price fall with a decrease of 4.2%.
The South East tops the table of regional applications with 270,398 in October and overall 66,700 residential properties in England and Wales lodged for registration in October ranging from £8,000 to £25.5 million.
The most up to date figures available show that during August 2012, the number of completed house sales in England and Wales decreased by 3% to 62,291 compared with 64,417 in August 2011.
The number of properties sold in England and Wales for over £1 million in August 2012 increased by 12 per cent to 843 from 753 in August 2011.
David Newnes, director of LSL Property Services, owners of Your Move and Reeds Rains, said that the fact that house prices are still rising annually points to relative stability in the property market.
He added that this is good news despite the limitations placed on first time buyer activity by historically tight lending criteria. Also there are signs of a slight improvement in mortgage lending as a result of the Funding for Lending Scheme, which should provide additional momentum in coming months.
‘However, the reality is that capital adequacy requirements are preventing lenders from giving the first time buyer market the disproportionate push it needs. The higher the LTV, the more funds lenders must allocate, and this is still deterring lenders from committing substantial funds from the Funding for Lending Scheme to the lowest tier of the housing market, and unleashing the thousands of frustrated buyers currently dependent on rental accommodation,’ he explained.
David Brown, commercial director of LSL Property Services, said that house prices are still rising annually, and Funding for Lending is likely to provide the main source of momentum for the housing market in the coming months.
‘But despite the recent signs of improvement in mortgage lending, and a mini bounceback in sales activity last month following a slower summer, lenders are being held back from boosting high LTV lending to any semblance of its pre-crunch level by the capital they are required to set aside for lending to those with small deposits,’ he explained.
‘In turn, this is sustaining demand in the rental sector and maintaining competition among renters, even outside the peak season. With the Financial Planning Committee set to clarify tomorrow the capital buffers banks must raise, it’s crucial that they don’t take drastic action that will undermine any progress the mortgage market has made, and limit the future impact of the Funding for Lending scheme,’ he added.
Jonathan Hopper, managing director of the property search consultants Garrington, believes that the property market is still looking both fragile and unpredictable. ‘Prices in the capital continue to defy both logic and gravity and their relentless rise is the main reason the national average posted a respectable 1.1% increase in the past year. Best of breed properties in London are seeing strong demand, and the bullishness is now radiating out to some areas from the capital. We saw asking prices increase significantly in London and the home counties last month. But London buyers are continuing to negotiate hard, and actual sale prices are increasing at a more realistic rate,’ he said.
‘October traditionally shows a spike in demand as many would-be buyers are spurred into action by the thought of finding somewhere by Christmas, or at least being at the front of the queue for next year. A gradual return to competition in the mortgage market should help demand too. But regional disparities are getting more glaring than ever, and the outlook for the country as a whole is still very mixed,’ he added.
