Average house prices in the UK increased by 5.6% in the year to April 2017, up from 4.5% the previous month but growth has been slowing generally since the middle of 2016, the latest index shows.
Month on month prices were up 1.6% to take the current average to £220,094, according to the UK house price index calculated from official residential figures from England, Scotland, Wales and Northern Ireland which was launched a year ago.
It means that prices are £12,000 higher than in April 2016 and £3,000 higher than March 2017 with the main contribution to the increase coming from growth in England where house prices increased by 5.7% over the year to April 2017 to an average of £237,000.
Wales saw house prices increase by 4.2% over the last 12 month period to £148,000 while in Scotland average price increased by 6.8% to an average of £146,000 and in Northern Ireland prices were up 4.3% to £124,000.
On a regional basis, London continues to have the highest average house price at £483,000, followed by the South East and the East of England at £315,000 and £281,000 respectively. The lowest average price continues to be in the North East at £123,000.
The East of England showed the highest annual growth, with prices increasing by 8.1% in the year to April 2017, followed by the South West at 6.8%. The lowest annual growth was in the North East, where prices increased by 0.6% over the year, followed by the North West at 4.1%.
The index also shows that in April 2017 the total number of seasonally adjusted property transactions completed in the UK with a value of £40,000 or above increased by 20.3% compared to April 2016 but the report points out that there were an unusually low level of transactions in April 2016 due to stamp duty changes.
Sales during February 2017, the most up to date HM Land Registry figures available, show that the number of completed house sales in England fell by 18.2%, sales in Wales fell by 8.8% and in London sales were down by 26.8%.
The index highlights a growing gap between house price inflation and affordability, according to Jeremy Duncombe, director of the Legal & General Mortgage Club.
‘First time buyers will be the ones who largely bear the brunt of this, as they are either being forced out of home ownership or having to turn to the Bank of Mum and Dad to help find a deposit,’ he said.
‘Although the general election result may bring a period of caution, our housing market has remained resilient to recent geo-political changes, with the wider economic factors being strong. We saw this through the UK’s decision to leave the European Union around this time last year,’ he pointed out.
‘Instead, the main factor behind continued house price inflation is still the vast difference between supply and demand. Quite simply, we need to build more affordable homes to allow a greater number of buyers to take their first steps onto the property ladder,’ he added.
