Rest of UK fails to match England’s price rise

Wednesday, 20 June 2012 9:56 AM

House prices rose 1.7 per cent in England in the year to April 2012 but fell in the rest of the UK, according to the index that is generally regarded as the most comprehensive in the market.

The Office for National Statistics (ONS) said the price rise in England was offset by falls of 1.1 per cent in Wales, 0.3 per cent in Scotland and 8.1 per cent in Northern Ireland.

Within England, there were increases of 4.9 per cent in London, 2.1 per cent in the South East and 1.6 per cent in the South West and smaller rises in the East, West Midlands and North East. However, prices fell in the East Midlands, Yorkshire and Humber and the North West.

The price of new homes rose by 5.1 per cent over the year while the price of pre-owned homes rose by 1.1 per cent.

There was little difference in the increase in prices paid by first-time buyers (1.5 per cent higher than a year ago) and that paid by existing owners (up 1.4 per cent).

However, the ONS said the end of the stamp duty holiday for first-time buyers had an impact on sales. In March, before the holiday ended, 43 per cent of homes were bought by first-time buyers, but this fell back to the long-term average of 32 per cent in April after the holiday had ended.

Taking April on its own, the average UK house price rose 1.1 per cent to reach an average of £229,000. Average prices now range from an average high of £388,000 in London to a low of £145,000 in the North East.

Howard Archer, chief UK economist at IHS Global Insight, told The Guardian prices were likely to fall by three per cent in 2012 as a result of fragile consumer confidence and economic uncertainty.

He said: “Housing market activity is persistently low according to long-term norms and, while it may eventually be lifted by more mortgages being granted at decent interest rates under the funding for lending scheme announced by the Bank of England and the Treasury, this is unlikely to be a major factor in the near term at least.”

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