In the 12 months to November 2013 UK house prices increased by 5.4%, down from a 5.5% increase in the 12 months to October 2013, the Office for National Statistics (ONS) has reported.
The year-on-year increase reflected growth of 5.6% in England, 5.4% in Wales, 2.5% in Scotland and 3.3% in Northern Ireland.
The ONS said house price growth is beginning to increase strongly across parts of the UK, with prices in London increasing at more than double the UK average.
Paul Smith, CEO of haart, said: “While London house prices maybe increasing at more than double of those in the rest of the country the fact that regions outside the capital are now playing catch-up is highly positive news.
“Other surveys have shown sentiment to be at a high and yet people are hesitating about putting their homes on the market. This could be that lack of stock means lack of choice but surely now is the time to consider moving as prices outside London are moving at a rate close to 6% year-on-year.
“London is another story with annual rises at 11.6%. But we believe this rate will slow in time and we do not predict a bubble developing in London because growing world demand for property here is as strong as ever and underpins the prime areas. This demand is now spreading out – now only to the London boroughs – but to most the regions which are showing a steady and orderly growth.”
The ONS said annual house price increases in England were driven by rises in London (11.6%), the South East (4.5%) and the West Midlands (4.4%).
Excluding London and the South East, UK house prices increased by 3.1% in the 12 months to November 2013.
On a seasonally adjusted basis, average house prices increased by 0.5% between October and November 2013.
In November 2013, prices paid by first-time buyers were 6.4% higher on average than in November 2012. For owner-occupiers (existing owners), prices increased by 5.1% for the same period.
Andy Knee, Chief Executive of LMS, added: “2013 has seen a ‘residential renaissance’ in the fortunes of the UK housing market, with average house prices surging forward by 5.4% in the past 12 months. However, the annual increase is down slightly from October’s 5.5% suggesting November saw a slight slowdown in the lead up to festive season. The market has clearly been propelled by the prosperous market in the capital, but it is evident that appetite for property is growing throughout the rest of the country – with notable price rises occurring in the South East and the West Midlands.
“The coming twelve months will be the true test for the market, with Help to Buy picking up the mantle from the axed Funding for Lending Scheme (FLS) and the introduction of more stringent lending measures which could limit borrowing levels. It is also vital that the vast chasm between the demand for property and the supply of new homes is satisfied to maintain growth and ensure the market is restored back to full health. Steps have already been taken and plans outlined, which is indeed an encouraging sign. But rhetoric must be realised, if the UK property market is to continue to prosper this year.”
