UK House Prices up by 2 per cent according to ONS figures

UK house prices increased by 2 per cent in the twelve months ending July 2012, driven by a 5.7 per cent rise in London.

The Office for National Statistics’ latest House Price Index shows that, excluding London and the South East, UK house prices increased by just 0.6 per cent over the course of the year but remain relatively stable. The average UK house price in July was £234,000, up from £231,000 in June.

Growth of 2.4 per cent in England was offset by a 1.1 per cent decline in Scotland and 0.2 per cent reduction in Wales. The largest decline was in Northern Ireland where house prices fell by 10.9 per cent in the twelve months ending July 2012.

Phoebus Software managing director Paul Hunt says: “These figures confirm that the housing market is robust, despite subdued lending activity across the board and the influence of central London stats on UK house price growth.

“There is still major stagnation at the bottom of the market but I’m hopeful that the Government’s recent announcement of a £280m extension of its First Buy shared equity scheme and plans for a new homebuilding programme will boost first time buyer activity. The Government’s role is crucial if mortgage lending targets are to be met in order to move the market forward.”

New time buyers were paying 1.8 per cent higher prices in July compared with July 2011 while prices for owner-occupiers were 2 per cent higher.

Prices of new dwellings rose by 1.6 per cent during the 12 months to July 2012, while the price of pre-owned dwellings increased by 1.9 per cent.