House prices up 10%

House prices surged by 10% in the year to July according to figures released by Halifax.  This is the biggest annual growth since the financial crisis of 2007.  The average house price now stands at £186,322.  This was helped by a 3.6% rise in prices in May to July.

Dig deeper & picture is mixed
Despite these rises there may be signs of a slowdown.  The Nationwide highlighted the fact that July had the smallest increase in prices over the last 15 months with just a 0.1% rise.  The slowdown in prices is part blamed from government efforts to scale back the help to buy scheme restricting it's availability to larger borrowers.  The government is also indirectly tightening lending criteria through the banks restricting the Loan to Value amounts available to home purchasers.

Whilst the headline figure seems impressive if London and the the South East is taken out of the equations it reveals a much more modest house price inflation in the rest of the UK.  The figures from Halifax and Nationwide also reflect the increasing availability of mortgage finance.  On a broader measure of house prices using the Land Registry figures the annual increase  is shown at only 6.4% with some areas such as Yorkshire and Humber even registering a fall.   This recovery may not be a one way street!

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