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House prices rose by 1.3% in July, according to the Land Registry, taking the annual fall in prices to 2.1% and the average price of a property in England and Wales to £163,049.
The housing index said the south-west experienced the greatest monthly rise with an increase of 2.2%, while the north-east experienced both the greatest annual price fall with a decrease of 8.8%, and the most significant monthly price fall at -2.3%.
The only region in England and Wales to experience an increase in its average property value over the past 12 months is London with a rise of 1.3%.
The Land Registry figures were published at the same time as the Home Builders Federation (HBF) announced a huge shortfall in planning permissions for new homes. Its data shows just 25,171 residential planning permissions were granted in England in the second quarter of 2011 – the second lowest quarterly number for five years and a 24% drop on the first quarter of the year.
Stewart Baseley, executive chairman of the HBF, said: “These figures paint a bleak picture. We already have an acute housing crisis that is affecting the quality of life of families – young and old – across the country, and the economy. Today’s extremely low levels of permissions will only make things worse in the short term.
“Our housing crisis is set to worsen. Government must stand firm and deliver a planning system that supports home building and economic growth. If it doesn’t, the social and economic implications will be felt for generations.”
Peter Bolton King, chief executive of the National Association of Estate Agents, unsurprisingly welcomed the news of a monthly house price rise. He said: “Buyers are coming back to the market – our figures show the average number of house-hunters registered per branch increased significantly in July, from 263 in June to 299. This is an unprecedented increase for what is traditionally a very quiet time.
“As mortgage conditions are more favourable now than at any time in the last three years, those in a position to buy are coming out of the woodwork and benefiting from prices that are, overall, still lower than a year ago.”
But Nicholas Ayre, director of property buying agents Home Fusion, said house prices were showing some signs of life as homebuyers were tempted to “test the water” as a result of the Bank of England hinting that interest rates are unlikely to be raised for many months.
“But there’s another factor at work – the supply of housing,” he said. “Planning permission approvals have dropped by almost a quarter since this time last year. If the shortage of housing gets worse, prices will inevitably creep up. But that’s hardly a vote of confidence in what remains a depressingly depressed housing market.”
The Land Registry also said the most up-to-date figures available show that during May 2011 the number of completed house sales in England and Wales decreased by 10% to 46,870 from 52,170 in May 2010. The number of properties sold in England and Wales for more than £1m decreased by 44% between May 2010 and May 2011, from 464 to 262.
Nick Leeming of Zoopla.co.uk added: “Low transaction levels and the year-on-year decline in average prices is representative of the caution gripping buyers and mortgage lenders alike.
“Lenders are beginning to offer more tempting mortgage products, but the pool of borrowers who qualify for these deals is very shallow. In addition, the cost of day-to-day living is squeezing peoples’ ability to save for deposits and get on to the housing ladder leaving a vast backlog of first-time buyers anchored to the rental market.”
From: http://www.guardian.co.uk/money/2011/aug/26/house-prices-rise-july-land-registry
House prices rise 1.3% in July