According to the figures, the average UK house price was £223,000 in June - £10,000 higher than in June 2016 and £2,000 higher than last month.
The main contribution to the increase in UK house prices came from England, where house prices increased by 5.2% over the year to June 2017, with the average price in England now £240,000. Wales saw house prices increase by 3.6% over the last 12 months to stand at £152,000. In Scotland, the average price increased by 2.9% over the year to stand at £144,000. The average price in Northern Ireland currently stands at £129,000, an increase of 4.4% over the year to Quarter 2 (Apr to June) 2017.
On a regional basis, London continues to be the region with the highest average house price at £482,000, followed by the South East and the East of England, which stand at £320,000 and £287,000 respectively. The lowest average price continues to be in the North East at £130,000.
Ishaan Malhi, CEO and founder of online mortgage broker Trussle, commented: “Homeowners worried about the prospect of slipping into negative equity will be happy to see a second consecutive month of house price growth. Hopeful first-time buyers looking to get onto the property ladder will naturally be less enthusiastic. Despite interest rates remaining at rock bottom, younger buyers still face the gruelling prospect of having to raise a deposit of around £30,000 which is higher than the average UK salary.
The surest way to boost homeownership among the younger generation is to build more homes, but aspiring homeowners could be waiting a while for that supply to arrive. In the meantime, the best bet is to make the most of government schemes like Help to Buy and Starter Homes, while shared ownership could also help realise the homeownership dream for those struggling to find a way in.”
John Goodall, CEO of buy-to-let specialist, Landbay, comments: “Against expectations inflation has held steady today, stealing the limelight from housing figures, which suggest that house price growth has now returned. Supply and demand remain severely out of kilter, meaning that housing affordability remains one of the most pressing issues facing UK society over the medium to long term.
The roots of the affordability crisis can be traced back to insufficient construction over the past decade, but a number of other macroeconomic factors are now also playing a part. Wage growth is struggling to keep pace with rocketing inflation, which is hitting people’s pockets and making it harder for aspiring homeowners to afford their first property, as well as discouraging existing homeowners from moving. This is pushing more and more people toward the private rental sector to house them while they save, so construction needs to focus not only on more affordable homes for first time buyers, but for the rental sector as well.”
Jeff Knight, Director of Marketing at Foundation Home Loans, commented: “With political uncertainty, stagnant wage growth and a continued shortage of properties – at least enough to meet demand – it’s been hard to see any real momentum in the market. Having said that, it’s never quite enough to put too much of a brake on purchasing, and with interest rates held at record lows buyers can continue to take advantage.
As ever, the rental sector is providing that stepping stone to ownership. Choice for tenants and high standards need to be maintained, so that those not yet at the stage of fully committing to a property can save confidently towards that first step onto the ladder.”
Ged McPartlin, Director of Ascend Properties, said: “The North West continues to prosper with an overall 5.5% rise in the year to June which is great news. The market is competitive, particularly in key areas like Manchester which has seen prices rise by 8% this year alone - demonstrating a very healthy market indeed.
The generous increase reported could be largely due to the economic drivers and an abundance of investment in and around the North West. The northern powerhouse initiative continues to provide a very positive outlook, in addition to the recent HS2 developments increasing connectivity to the rest of the country. The North West is certainly giving the likes of London a good run for its money.”
Andy Sommerville, Director at Search Acumen, comments: “A slowdown in house price growth is good news for first-time buyers and those looking to move up or down the housing ladder. At the same time, lethargic price growth will undoubtedly worry those who have a large amount of equity tied up in property.
Ultimately, the current market can’t satisfy everyone, but it needs to be fed with new stock required to provide for Generation Rent whilst creating stability for those already lucky enough to be on the housing ladder.”
There is not enough action to tackle chronic lack of supply. Yet again we call on the government to jump-start our housebuilding sector and reassure homeowners and prospective buyers from across the UK.”
Paul Smith, CEO of haart, comments: “House prices continued to rally with unflinching determination once again in June despite the ongoing economic uncertainty. However this means that the average UK buyer now has to fork out an extra £10,000 more to own a home than the same time last year. Along with consumer price hikes and falling wage growth, unaffordability is reaching a crisis point. This is creating real impact on the ground as we see first-time buyer registrations drop by almost 20% on the year across our branches.
The resolution is clear – Government must stop excessive profiteering at the plight of the aspiring home owner and cut the stamp duty stealth tax. Unless we see a more comprehensive break for first-time buyers, the UK’s legacy as a property-owning democracy is at risk of vanishing.”
However London’s ongoing house price ‘correction’ continues, as it experiences just 0.4% more annual growth in June than the worst performing North East. A lot has changed since a year ago where London outperformed the same region by 11%. Buyers in London should act now before growth bounces back.”
Nick Leeming, Chairman at Jackson-Stops & Staff, comments: “A double crutch of record low mortgage rates and a lack of homes for sale continue to keep house price growth strong, with the East of England’s 14 month streak as top region for house price growth unbroken. Whilst this is good news for many homeowners seeing the equity in their home increase, it does place the goal of home ownership further out of reach for aspiring first-time buyers. Meanwhile other recent data shows transaction levels and new buyer enquiries performing sluggishly, which could have escalating consequences for people wanting to move relatively quickly, whether to cater for their growing family, a new job or a lifestyle change.
With average London prices standing at nearly half a million, the capital is the only region to see prices fall on the month. Compared to the eastern regions where annual house price growth is full speed ahead, London is travelling in reverse. Prohibitive levels of stamp duty land tax continue to have a profound impact on market fluidity for higher value properties. We will have to wait and see how and if the Government decides to tackle this.”
