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Nationwide reveals accelerated house-price growth

Amanda Jarvis

April 7, 2006

Nationwide's House Price Report: Quarterly Regional Review
Prices, revealed:

* House price growth accelerated in all UK regions in Q1
* House price rise in London outpaced UK for first time in four years
* Prices in Northern Ireland grew more than three-and-a-half times as fast as UK average
* House prices grow least in northern region at only a tenth of the UK rate

Fionnuala Earley, Nationwide’s group economist, said:

Spring bounce in house prices across the UK
“House price growth in the UK accelerated into the first quarter of 2006. Prices increased by 2.3 per cent since Q4 2005, the fastest quarterly increase since Q3 2004. Compared with the first quarter of 2005 prices are 4.9 per cent higher, making the price of a typical house in the UK £160,319.

“The annual rate of house price growth increased in all of the UK regions in the first quarter, but the fastest growth was in Northern Ireland where prices rose by 17.6 per cent – more than three-and-a-half times faster than the UK average. The slowest growth was in the northern region where prices increased by 0.5 per cent to £123,483 – only about a tenth of the UK rate.

House prices in Northern Ireland pull away
“Over the last year house prices in Northern Ireland increased by a remarkable 17.6 per cent – more than three-and-a-half times the average rate of growth in the UK. The price of a typical house in the Province has now jumped above those in Scotland and the northern region, and at £129,321 is no longer the cheapest place to buy in the in the UK.

London shows signs of recovery
“The London market continued to show some signs of recovery in the first quarter with increases in the rate of growth of price on both an annual and quarterly basis. Prices in the capital increased by 2.2 per cent in the quarter and 5 per cent over the year. This is the first time in four years that the annual rate of growth of house prices in London was above the UK average. House price growth in the outer south-east and outer metropolitan regions also picked up in the first quarter, although growth here still remains below the UK average.

House prices in the Yorkshire & Humberside and north-west still rising strongly
“Prices in Yorkshire and Humberside and the north-west are still rising strongly. In Yorkshire & Humberside annual house price inflation has been above the UK average for most of the last four years while the north-west has also seen increases above the UK average for most of the last three.

Slower growth in the northern, Midlands and East Anglia regions.

“The northern, East and West Midlands, and East Anglia were the regions with the slowest annual growth in the first quarter, although the rate of growth was stronger than three months ago in each region. East Anglia however saw a slowing in the rate of growth over the last three months and was the only region in England where house price growth decelerated in the first quarter. The northern region however, experienced the fastest rate of growth in England in the first three months of the year.

Sub-regional analysis
“In the same way that the national picture masks movements within the regions of the UK, looking at standard regions masks developments within the regions. Using a different methodology from our main house price index we are able to show a more detailed picture of developments at a more local level.

Prices grew fastest in Aberdeenshire & Moray
“Aberdeenshire & Moray saw the fastest annual rate of house price growth in the first quarter. Prices in this sub-region of Scotland increased by 18 per cent. The top five fastest growth areas in the country were geographically mixed. The Isle of Wight recorded growth of 17.4 per cent, St Albans 16.7 per cent, The City of Belfast 15.9 per cent and Northern Ireland (north-east) 14.9 per cent.

House prices fell by most in mid Lincolnshire
“Prices fell by 6 per cent over the last year in mid Lincolnshire and by 5 per cent in Derby, Windsor & Maidenhead and Leeds. After facing the largest falls in prices in 2005, Durham recovered most in the last 12 months. Prices increased by 12.3 per cent in the year to March, compared with a fall of 12.7 per cent in 2005.”


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