London house prices at pre-crisis peak - Mortgages - News - Moneyfacts


London house prices at pre-crisis peak

London house prices at pre-crisis peak

Category: Mortgages

Updated: 28/06/2012
First Published: 28/06/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

London continues to see house price growth as most other regions in the UK experience falls, new figures released today show.

According to Nationwide's house price index, nine out of the 13 regions in the UK witnessed falling prices over the second quarter of 2012. Bucking the national trend, prices in London increased by 1% quarterly and by 1.2% on an annual basis.

The West Midlands and Outer Metropolitan were the only other regions in the UK to see prices rising, by 0.4% and 0.2% respectively over the quarter.

On a monthly basis, UK house prices fell by 1.5% in June, compared to a 0.2% rise in May, and are 1.5% down on the same point a year ago and 1% down on the quarter.

Prices in London have now recovered to their pre-crisis peak, with the average cost of buying a home in the capital standing at £302,399, compared to a UK average of £164,955.

The index shows the gap between prices in the North and South continues to widen, with Northern Ireland (-10.6%), Wales (-5.3%) and the North West (-4.1%) recording significant annual drops in house prices.

Commenting on the figures, Nationwide's chief economist Robert Gardner said: "The slightly weaker trend we've observed since March is unsurprising, given the difficult economic backdrop, with the UK economy dipping back into recession at the start of the year and few signs of a near term rebound.

"Part of the weakness in house prices may also relate to the ending of the stamp duty holiday in March, which provided a temporary boost in early 2012, as buyers brought forward purchases that would otherwise have taken place later in the year.

"The outlook for house prices remains highly uncertain. Economic conditions are expected to remain challenging over the next twelve months.

"However, policymakers' efforts to bolster the supply of credit to the economy and to help lower the cost should provide support to demand. Moreover, the supply side of the market is still constrained, with construction failing to keep pace with the number of new households being formed."

Find the best mortgage rate - Compare best selling mortgages

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Goodbye to the Help to Buy Guarantee

On 31 December, phase two of the Help to Buy initiative will be withdrawn from the market. It’s certainly done wonders for the high loan-to-value sector, so we thought we’d take a closer look at the significance of the scheme and the effect it’s had.

Remortgaging bounces back

Remortgaging has been enjoying a welcome boost in recent months, despite September’s slight dip, with many homeowners capitalising on record low mortgage rates to boost their finances.

Bank of Mum and Dad holds the (house) key

The Bank of Mum and Dad is an important source of finance for many young adults, and it seems that they still hold the key – in more ways than one.