19 Sep

Increase in property prices

Increase in property prices

House prices rose last month, according to the latest figures from the Land Registry.

Annual property prices increased by 8.4 per cent in England and Wales by the largest rate for almost seven years and may suggest the property recession is truly over.

The Land Registry data revealed prices were up by one per cent in August compared with July, with the majority of increases being driven by the London market.

Although there was some slight falls in areas of the UK, such as Windsor and Maidenhead and South Yorkshire, reporting month-on-month falls.

The average house price in England and Wales now stands at £177,824 compared with the peak of £181,383 in November 2007.

Over the past 12 months, prices had risen by 21.6 per cent in the capital - the slowest rate of increase was three per cent in the North East.

"For prices to rise by nearly three per cent in just one month alone shows the London market continues to defy gravity," said Jonathan Samuels, chief executive of Dragonfly Property Finance told BBC News.

"Some areas of the UK are looking dangerously overpriced, while others are still very much flat and even in the red."

The Royal Institution of Chartered Surveyors has suggested that August prices will plateau as London prices become unsustainable.

Charity Shelter has warned the increasing property prices may make it even harder for people to step on to the property ladder and this is leading to a 'rent trap' for many households across the UK.

Campbell Robb from the housing charity, said: "People across the country anxious to put down roots are instead finding themselves stuck in the 'rent trap' - moving from one expensive and unstable rental property to the next, with little hope of saving enough for a home of their own."

He added that the governments needs to review the situation and "start meeting people halfway by taking real action to build the affordable homes we desperately need".ADNFCR-1222-ID-801751493-ADNFCR

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