Average UK prices up 1.4% in May, latest data shows

Average UK house price increased 5.6% annually and 1.4% on a monthly basis in May, taking the average home price to £212,495, according to the latest data to be released.

In London the market is seeing significant growth again following reservations around the general election with prices up 16.7% year on year and 3.4% month on month to an average of £536,286.

Sales in London have recorded their biggest monthly uplift since August 2014 and the monthly data report from haart estate agents also shows that in May there were 11 buyers chasing each available property across the country but this rises to 20 in London.

Overall data from the firm has now shown a steady upward trajectory for UK property prices since November 2014, which has been driven by high levels of demand in relation to supply.

Average first time buyer property prices across the UK are also on the increase, up 4.3% annually and 1.7% on the month. The number of new buyers registering has increased marginally on the month in May, up by 0.3% since April.

However, the number of new buyer registrations is down 12.7% annually. But the firm says that given the particularly high levels of buyer activity in 2014, a fall in the number of new buyers is to be expected.

The volume of new property instructions coming to the market has increased 2.6% on the month and haart says that this emphasises that sellers are feeling confident when it comes to putting their home on the market.

There are now 11 buyers chasing each property for sale across the UK, which is a slight fall in activity levels on an annual and monthly basis but still shows that the market is busy, with consumer confidence high.

The average loan advanced to a first-time buyer has increased 4.2% annually to just shy of £130,000 which the report says reflects strong institutional confidence in lending. As with the number of new buyer registrations, first time buyer registrations have fallen annually, which is a reflection of the strength of last year’s market.

The data also shows that the North of London is the most expensive postcode area in which to buy with prices up 36% annually to an average £667,944. The North West is the only postcode area where the average property price is still less than £400,000.
Paul Smith, chief executive officer of haart pointed out that with all this positivity in the air and continued low mortgage rates more people will aspire to buy, and without accompanying fresh supply property will become more unaffordable.

‘First time buyer activity in London is down significantly with 30% fewer first time buyer registrations in May 2015 compared to May 2014. The result will be that young professionals are driven from key areas as they can’t afford to live there,’ he said.

‘This is bad news for local economies and the UK as a whole and we need at least 200,000 homes built every year across the next Parliament to keep the housing supply crisis under control,’ he added.