ONS: House price growth fell to 7.7% in September

Ryan Bembridge

November 15, 2016

Annual house price growth fell to 7.7% in September, down from 8.4% the month before, Office for National Statistics data shows.

Growth was highest in the East of England (12.1%), followed by London (10.9%) and the South East (9.9%). It was lowest in the North East (1.5%) and Scotland (3.4%).

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: ‘These figures are interesting because they are the most comprehensive snapshot of house price activity we have but of course they are a little historic.

“They do bear out what we have seen in other reports as well as on the ground which is that property prices are being supported by a lack of stock and are rising faster out of London than in the capital.

“Certainly we might have expected a worse result given the level of uncertainty around Brexit but the numbers show that buyers and sellers are reaching agreements and getting on with it.”

John Goodall, chief executive and co-founder of peer to peer platform Landbay, felt political uncertainty has taken the edge off house price inflation in the short-term but in the long-run the lack of housing supply will continue to push up prices.

He said: “It’s not a new problem, demand for new households has exceeded the number of new homes built in every year since 2008, but it’s been thrown into sharp relief recently by a higher price to build, a consistently growing population, and relatively stagnant wage growth.

“Record low mortgage rates are helping those who have already stumped up a deposit, but this isn’t much relief to aspiring homeowners looking to get their foot on the housing ladder in the coming months.

“The buy-to-let market has become a lifeline for Generation Rent, and is growing healthily to meet this demand, but we need an ironclad commitment on house building from policy makers. All eyes then will be on next week’s Autumn Statement to see how the Chancellor plans to address the issue.”

John Eastgate, sales and marketing director of OneSavings Bank, sang from the same hymn sheet.

He said: “Although house price growth has cooled in parts of the UK, fundamentals suggest that the long term upward trend will continue, and political uncertainty must not distract policymakers from the underlying structural issues that continue to plague the housing market.”

He added: “We’re not expecting a silver bullet at the Autumn Statement, indeed the government has admitted that it will miss its already conservative target of one million homes by 2020, but we do hope to see a raft of measures to encourage construction and improve affordability in the housing market.

“An £18m fund announced last week to accelerate planning permissions in England is one such measure, but this alone is but a drop in the ocean if we are hit the 300,000 new homes per year that the UK will need.”

Sign up to our daily email