Prices surpass pre-crash levels
In June the typical house price in England and Wales was £181,619, exceeding the previous peak of £180,983 in November 2007. Overall, prices rose by 5.4% annually and 1.1% month-on-month.
In the North East prices rose to £102,064 in June, although London still leads the way by area as they increased by 9.2% to £481,820 year-on-year.
Duncan Kreeger, director of West One Loans, said: “House prices have now returned to pre-crash levels, with the capital once more driving the market with the most significant rises.
“But while this is music to the ears of homeowners who will see the value of their asset rise, it is further frustration for first-time buyers who see their dreams of property ownership pushed further out of reach.”
The property market has cooled from last year, as the number of completed house sales decreased by 19% to 57,180 in June 2015 compared to 70,244 in April 2014.
Repossessions have also decreased from 974 in April 2014 to 505 last month, reflecting low mortgage rates and a safer market.
Annually prices have increased by 8.4% in the South East, 7.8% in the East, 5.2% in the South West and 5.0% in the East Midlands.
On a monthly basis they have risen by 1.8% in London and 1.7% in Wales, while they fell by 0.9% in Yorkshire & The Humber and 0.8% in the East.
Adrian Gill, director of Your Move and Reeds Rains estate agents, reckoned the bottom of the property market is in good shape.
He said: “It is the region with the lowest average house price – the North East – that has seen the biggest monthly improvement in prices, as cheaper mortgage finance and government support schemes inject more energy into areas where the recovery needs a careful watch.
“While these symptoms all look promising, prices will only head north if the supply of new homes coming onto the market dries up. Growth in the construction industry was flat during the second quarter of this year, which should be ringing alarm-bells. Buyers’ purchasing power has rarely been stronger, but this golden opportunity will be spoiled if there’s nothing for them to buy.”
Kreeger blasted the government for so far failing to deliver on its promises to significantly boost housebuilding.
He added: “This lack of supply places further price pressure on existing stock and means that prospective homeowners are facing an uphill struggle.
“We heard plenty of promises before the general election about how many new homes would be built each year and now is the time for the government to make good on their pledge. Developers and those reintroducing properties to the UK’s housing stock need lending support to help deliver this.
“And while short-term providers have taken up some of the slack, high street lenders need to follow suit.”