House prices up 3.1pc in 2012
Over the year to January 2013 average house prices in England & Wales have risen by 3.1% in line with the annual rate of inflation.
January marks the eighth consecutive month that house prices have risen with the average price paid for a house in January 2013 being £480 (0.2%) more than that paid in December.
The Index also shows that sales are up by 8% as mortgage availability improves and bank funding conditions loosen.
David Brown, commercial director of LSL Property Services, said: “Market conditions are certainly improving. Funding is cheaper thanks to a combination of the Funding for Lending Scheme and an improvement in investor confidence.”
Despite the positive results Greater London continues to dominate the housing market in terms of annual price change.
When London is taken out of the equation the average rate of house price growth in England & Wales falls to just 1% over the year.
Brown said: “With the recovery of the housing market outside of London still on such a precarious footing, house prices and sales in 2013 will closely be tied to how well banks cope with the financial grenades being thrown their way by regulators and the eurozone.
“George Osborne’s plans to electrify the ring fence separating retail and investment banking could give lenders a sharp shock in 2013.
“They will be forced to focus their energy on implementing drastic reforms rather than on ways to improve lending levels and mortgage availability.
“With any luck, George Osborne will be bold and use March’s budget to implement a more dynamic economic growth strategy.
“That should see the housing market really kick on in 2013 and put it on the road to a sustained recovery.”