30 Jun

Property prices up by 6.7%

Property prices up by 6.7%

The latest data from the Land Registry shows that property prices in England and Wales increased by 6.7 per cent in May.

This takes the average price of a home to £172,035 - getting close to the peak value of £181,518 in November 2007.

In total, 72,450 residential properties were lodged for registration last month ranging in price from £7,000 to £39 million.

This was a rise in the number of completed house sales - up from 16 per cent to total 63,687 - compared to 54,708.

Homes selling for more than £1 million also increased, with a rise of 28 per cent to 840 properties.

London saw the greatest increase in property values over the past year, with a rise of 18.5 per cent and the capital also saw the greatest monthly rise of 2.5 per cent.

The lowest yearly increase in growth was seen in the north-east with an increase of 0.9 per cent, while prices fell in Yorkshire and the Humber by 0.9 per cent during the month of May.

Figures also suggest that the economic situation for many is picking up with a drop in repossession volumes of 37 per cent.

However, experts are warning that although prices are on the rise in the capital, there is less evidence of substantial increases across the rest of the country.

David Brown, commercial director of LSL Property Services, explained: "Stability is not the finish line for the housing market. Sustainable price growth must go hand in hand with a growing stock of homes, and growth is the order of the day.

"The property industry will still take some time to recover fully from the longest recession on record and construction will only pick up more swiftly after the purchase market has demonstrated its stability."

He added the rental market is filling gaps, with rental prices now rising in line with salaries but a lack of new properties could have an impact in the long-term.

Meanwhile, the government has confirmed that many regions across the UK could be able to benefit from new funding for the construction of extra homes.

Communities secretary Eric Pickles, speaking at the Chartered Institute for Housing conference, explained that housing is vital for the long-term success of the UK in terms of economic and social benefits.

A total of £53 million will be used to speed up construction of over 7,000 homes on large developments in Manchester, Medway, Swindon and Kettering.

The additional funds are being provided via the Local Infrastructure Fund and means the total of homes built since the scheme started in 2012 to more than 80,000.

It has also been confirmed that more than £1 billion has been set aside for the initiative over the next five years.

Over £49 million will also be spent on three new schemes under the Build to Rent programme in Hampshire and Croydon. The money will be used to construct more than 500 homes to be rented privately and meet the strong demand from prospective tenants in the region.ADNFCR-1222-ID-801731977-ADNFCR

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