Better lending conditions drive up prices
On a monthly basis, prices crept up by £707 in April and have only fallen once in the past 17 months.
The index placed the average house price at £231,170 which represented a 0.3% monthly change in April and a 3% annual change.
Regional data revealed that Greater London continued to dominate the housing market in terms of annual price change with house price inflation over twice that of any other region of England & Wales. For the third month running East Anglia took second place and joined Greater London in being one of the only two regions in the country with annual price increases higher than the average for England & Wales as a whole.
The region with the largest fall in annual house prices is the North, down 1.3% over the year, marginally below Wales where prices have fallen by 1.1%.
Dr Peter Williams, housing market specialist and chairman of Acadametrics, said: “Since August the increase in average house prices at the national level has been remarkably consistent, edging upwards with monthly percentage increases ranging in a narrow band of between 0.1% and 0.6%.
“Putting together the Funding for Lending scheme (which had delivered some £14 billion by the end of 2012), along with Help to Buy (£13.5 billion for equity loans and guarantees), NewBuy and First Buy (£1.5 billion), the Build to Rent and Rental Funding Guarantee schemes (£10.5 billion), plus other funding, takes the total to over £40 billion being pumped into lending for development and mortgages over a four year period.
“This is without doubt the largest intervention by government in the housing market for many decades and highlights the concerns government has over this market and of course the wider economy.
“These two issues are intertwined with the expectation that more housing market activity will help stimulate the economy. Clearly there is frustration that the market is only picking up slowly, however it is evident that there is now a real appetite to see house prices rise and activity increase, whereas previously the focus had been on deflation.
“To date it is London and the South East along with other selected areas where we see most activity; the big question will now be how far these stimulus measures really impact across the country as a whole (some measures are for England only). If they don’t, the risk is that the differentials will increase.
“However, what should be very clear to consumers is that the government is backing the housing market strongly. This should help to increase confidence, which ultimately is a key driver.
“Unfortunately alongside this is the clear sense of budget cuts to come, and all the risks to jobs and wages that flow from that. It is this mix of positives and negatives which means many households will continue to hold back.
“Taking the first four months of 2013 and comparing it to the first four months of 2012, our current estimates suggest that 2013 is a marginal 0.2% (equivalent to approximately 500 homes) ahead on the number of properties that have been sold to date, compared to last year. The RICS housing market surveys suggest that new homes enquiries are rising, as are agent buyer and sales expectations.
“Put these alongside stable or rising nominal prices, and the overall picture is one of a market that is slowly edging upwards.”