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Monday, March 18, 2019

Latest House Price Index from LSL

Prices edged up for the third consecutive month in February, rising 0.5% to take the average value of a home in England and Wales to £302,435. A spike in prices early last year, however, means prices are down 0.5% compared to this time last year.

Overall, prices remain subdued. An estimated 59,100 sales in February 2019.

Oliver Blake, Managing Director of Your Move and Reeds Rains estate agents said:

“Whilst a challenging market, it’s amixed picture, with some regions still experiencing price rises; there clearly continues to be demand for property and aneed for more homes to come to market.”
Whilst prices are down annually, primarily because they saw a surge at the start of last year, with a peak reached last February. Average prices have risen over the last three months.

Given the challenges of affordability from a decade of rising prices and sluggish wage growth, a short slowdown in prices combined with increases in pay could be a positive outcome for the market in the long term. The market still requires actions to ensure an adequate supply of housing.

As ever, the overall average hides a myriad of different stories. Crucially, there is a distinct North/South divide, with Wales in particular still growing robustly, up 3% annually. Most of the major conurbations outside London also continue to see growth, led by Cardiff (up 5.3%).

In London, prices have risen for the last five months, leaving the average price in the capital at £622,494.

As last month, the North/South divide largely persists in the regions of England and Wales, with annual falls concentrated in the South Eastern corner of the country.

The South East region itself is seeing the fastest falls in prices, with the average house values down 1.7%, despite strong growth in the Isle of Wight (up 7.0%) and Southampton (up 4.2% annually to set a new peak average price).

The picture is complicated by modest growth in the South West (up 0.3%). There, strong growth in Bournemouth (up 7.3%) and new peak average prices in Bristol (up 0.3%), Gloucestershire and Somerset (up 3.8% and 3.9%, respectively) remains enough to outweigh downward pressure from the likes of Bath and North East Somerset (down 10.2%) and North Somerset (down 5.4%). Likewise, the North East refuses to conform to the pattern. Prices there are down 1.6%, with significant falls in Redcar and Cleveland (falling 7.3%) and Middlesbrough (down 6.5%).

Outside these areas, though, growth continues and the majority of local authorities (59 out of 108) saw averages prices rise. For the most part the increases are modest. In England, the North West sees the strong growth with average prices up 1.3% annually. This is supported by strong performance in Manchester, which set a new peak average price in the month and where values have increased 3.1% in the last year. The West Midlands also performs well, with growth of 1.7%, but in the East Midlands and Yorks & Humber regions growth is under 1.0%.

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