Tuesday, 17 July 2012 10:45 AM
House price inflation accelerated to 2.3 per cent in the year to May 2012, according to the Office for National Statistics (ONS).
This is the largest increase recorded by the ONS since December 2010 but it still means that house prices were falling in real terms. Retail price inflation was 3.1 per cent in the year to May but fell to 2.8 per cent in June.
And the UK average conceals big variations between Wales (up 3.5 per cent), England (up 2.6 per cent) and Scotland (down one per cent) and Northern Ireland (down 10.3 per cent).
Within England, the annual rate was driven by increases of 7.2 per cent in London, 3.4 per cent in the South East and 2.3 per cent in the East Midlands. The largest price falls came in the North West (down 1.6 per cent) and West Midlands (1.2 per cent).
Prices of new homes were up 6.2 per cent over the year whereas prices of pre-owned homes rose by two per cent.
First-time buyers paid an average of 2.8 per cent more to get on the ladder whereas existing owners paid prices that were 2.1 per cent higher.
On a UK basis, prices began to recover from the credit crunch in late 2009 and the annual rate of house price inflation hit more than 10 per cent in mid-2010 before falling again over the rest of the year.
The 2.3 per cent increase in the year to May was the biggest seen in 2011 and 2012 so far but prices have been falling in real terms throughout that time.
On a seasonally adjusted basis, prices were unchanged over the month in May at £228,000. That followed a 1.1 per cent rise in April.