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House prices up 7.7% in the year to November

by: Mortgage Solutions
  • 19/01/2016
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House prices up 7.7% in the year to November
UK house prices increased by 7.7% in the year to November 2015, up from 7% the previous month, according to data from the Office for National Statistics.

But this healthy rise wasn’t evenly spread across the UK, boosted by property price increases in England of 8.3%. In Scotland prices rose marginally by 0.4%, in Wales by 1.3% and by 4.3% in Northern Ireland.

Within England prices were driven by a double digit annual increase in the East (10.2%), as well as strong movement in the South East (9.8%) and London (9.8%).

When London and the South East are excluded from the calculations, UK house prices increased by 5.8% in the 12 months to November 2015.

Brian Murphy, head of lending at Mortgage Advice Bureau, said: “House prices in November saw the biggest annual increase in eight months, despite traditionally being a quieter time in the housing market. Those lucky enough to already be on the property ladder are the clear winners of this boom, as homeowners trading up to the next rung take advantage of improving property values. Increased equity means even those not looking to sell can benefit by switching to a more affordable mortgage deal.

“The heat is set to rise in the buy-to-let and second home market in the short-term, as buyers rush to complete before the changes to Stamp Duty kick in in April. In the long-term, the dearth of properties available combined with rampant demand means house price growth isn’t likely to slow any time soon. This creates clear affordability concerns for first-time buyers.”

Stephen Smith, director, Legal & General Housing Partnerships, said the gulf between supply and demand continues to widen putting upward pressure on prices.

“Suitably sized housing needs to become more readily available at both ends of the market, to enable first time buyers to take their first steps onto the housing ladder and help last time buyers to ‘rightsize’, making life better for all.”

He added: “There are currently a number of constraints which elongate the house building process and the country should consider exploring alternative avenues to help speed up construction, such as modular housing.”

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