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UK annual house price growth leaps to 7% in October

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  • 15/12/2015
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UK annual house prices gathered pace again in October to hit 7%, up from 6.1% the month before.

In the final index of the year, the Office of National Statistics index confirmed house prices continue to power on, albeit in a patchy way, with annual inflation hitting 6.4% in England, 1% in Wales, 0.9% in Scotland and 10.3% in Northern Ireland.

Growth has been driven by an increase of 10.4% in the East and 9.5% in the South East as excluding London, prices only rose by 5.6% across the UK.

The index, previously published by the Department for Communities and Local Government, showed prices increased by 0.8% between September and October 2015.

Affordability continues to be stretched with the average house price in England hitting £300,000, £196,000 in Scotland, £174,000 in Wales and £158,000 in Northern Ireland.

First-time buyers are paying 5.9% more to secure their first homes than this time last year, with owner occupiers paying 7.4% higher prices.

Jeremy Duncombe, director, Legal & General Mortgage Club, said on the ONS House Price Index: “Today’s figures from the ONS show a marked month-on-month increase in house prices for October, as lack of supply and rising demand continue to make homeownership more unaffordable.”

He added: “House prices have risen strongly throughout the year, well beyond the level of inflation and wage growth and, without a strong supply-side initiative from the Government, will likely rise well into 2016.”

Yesterday, Rightmove reported it expected prices to rise 6% in 2016 after a strong finish to the year.

He suggested the Help to Buy initiatives will ease some of these pressures, but said the government must build more homes across the country and incentivise people to ‘rightsize’ through tax breaks and Stamp Duty discounts to free up housing stock.

 

 

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