New homes prices at 18 month high
The average price of a new house in the UK in March was £264,709, an increase of 1.9 per cent on the previous month. This constitutes its biggest increase since November 2004, and overall a 3.1 per cent rise from the same time in 2005.
The research also showed the prices that buyers were willing to pay for a new home are 3.8 per cent higher than at this time last year, which, according to SmartNewHomes.com, points to a resurgent housing market.
David Bexon, managing director of SmartNewHomes.com, said: “After almost a year of negative annual price inflation, the market is back on track and 2006 is likely to be a year of sustainable growth. Consumer confidence has returned as buyers realise the market will not crash, interest rates remain low, and demand still outstrips supply.
“The next couple of months could see a further boost in prices as the market enjoys a traditional Spring boom.”
The biggest price rises in new homes came in Greater London, an increase of 11 per cent in the past year.
Other areas which experienced strong price growth included Yorkshire and Humberside, while Scotland’s recent boom, which has seen prices rise by 6.2 per cent over the year, continued with a 1.1 per cent increase in March.
Jim Gillespie, principal of Independent Financial Services, said: “Prices have been steadily increasing and while they tailed off in the second half of last year, since January they have been going up again. This time of year, there is traditionally a flurry of activity with more houses coming onto the market, so as long as interest rates stay as low as they are, this upward trend in prices should continue.”