House prices continue to increase steadily across the board, according to the latest ONS HPI data
The Office on National Statistics (ONS) has released their latest House Price Index for May 2015. Notable points from analysis of the report include:
- UK house prices increased by 5.7% in the year to May 2015, up from 5.5% in the year to April 2015.
- The average UK mix-adjusted house price in May 2015 was £274,000.
- The pace of annual house price growth increased slightly across the majority of the UK in May 2015.
- Annual house price increases in England were driven by an annual increase in the East (9.3%) and the South East (8.2%).
- London prices increased by 4.7% over the year to May 2015 (up from 4.3% in the year to April 2015).
- On a seasonally adjusted basis, average house prices increased by 0.9% between April and May 2015 – compared to an increase of 0.8% in average prices during the same period a year earlier.
- In May 2015, prices paid by first-time buyers were 5.1% higher on average than in May 2014. For owner-occupiers (existing owners), prices increased by 5.9% for the same period.
Peter Rollings, CEO of Marsh & Parsons, comments:
“A few months ago it would have been unthinkable that house prices in London would be rising at a slower rate than the national average. Yet the rates of growth seen in the East and South East have overshadowed London, which was disrupted by the storm of the general election and dampened by talk of a Mansion Tax.
“However, throughout the remainder of May – once the ballot papers were in – growth improved across the country. And perhaps the most revealing indicator is that the 0.9% month-on-month jump is stronger than we experienced a year ago. In the last month, we have seen more and more properties come on to the market, which matches a higher demand from more confident buyers. Demand for mortgages is firmly on the up, and as buyers get their finances in order, a new wave of activity will carry prices forward over the summer months.”
Andy Knee, Chief Executive of LMS, comments:
“May offered some respite to first-time buyers. Prices paid by existing homeowners increased by almost 6% year-on-year; on the other hand, the first-time buyer market saw a slightly smaller increase of 5.1%. A rise in the average income of first-time buyers, as reported by the CML, is a further boost to their prospects as we enter the summer season.
“However, the number and value of first-time buyer loans is down from May of last year, an indication that more still needs to be done to support prospective homeowners. Increased supply and more affordable housing also remain critical to ensuring stability within the market.
“While remortgaging as a whole is down from last month, it still accounts for more than half of activity in the buy-to-let sector. We may see an upward trend here in the future as landlords look to mitigate the reduction in interest tax relief following the Emergency Budget. By remortgaging, buy-to-let landlords can ensure they have the best deals on the properties in their portfolio.”
Has your firm noticed any fluctuations in transaction levels as a result of the house price increases? How has the general election affected business – if at all?
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