Property prices edged up in Wales in recent months, latest index shows
The average house price in Wales increased by 2.9% in the 12 months to March 2018 to £181,320 but growth is slowing on a quarterly basis, the latest index report shows.
In the first quarter of 2018 prices increased by just 0.2%, lower than the growth recorded in the final and the third quarters of 2017, according to the house price index from the Principality Building Society.
The index also shows that sales are down, having fallen by 4% across Wales in the first quarter of 2018 compared with the same quarter last year. Sales fell for all property types apart from detached houses.
The report reveals that while sales increased in January to their highest level for five years, transactions in February and March were below the levels recorded in 2017 and 2016.
‘The Welsh housing market continues to grow at a modest, steady rate, as home owners continue to take advantage of historically low borrowing rates. The market is still being driven largely by first time buyers and re-mortgaging,’ said Tom Denman, Chief Financial Officer at Principality Building Society.
‘The number of mortgages for first time buyers is growing at twice the rate of the rest of the UK in Wales and it would appear Help to Buy Wales has clearly had a positive impact on the housing market. This is welcome news for those looking to step on to the housing ladder in Wales,’ he added.
A breakdown of the index figures reveals there are 10 areas where the annual price increase exceeded 4.5%, and 12 areas where the rates were lower. Monmouthshire had the highest rate of change in prices over the last 12 months, up 8.6%, and is also the local authority area with the highest average house price in Wales at £279,434.
The report suggests that when the Severn Bridge toll fees are abolished at the end of 2018 it will make commuting to cities like Bristol much cheaper and this could results in a rise in property sales in Monmouthshire and nearby towns and cities across South East Wales.
The area with the largest increase in prices over the quarter was Wrexham where prices increased by 5.7%, followed by the Isle of Anglesey with growth of 5%. In Wrexham it is the price of detached homes that have seen the largest increase in values, from an average £230,000 in the fourth quarter of 2017 to £255,000 in the first quarter of 2018.
According to the report the introduction of the new Land Transaction Tax at the beginning of April could have an impact on the market, particularly at the higher end for properties worth over £400,000 where a higher rate of tax is now payable.