For owner-occupiers (existing owners) prices increased by 2.2% for the same period.
House price growth remains relatively stable across most of the UK, although prices in London are increasing and prices in Northern Ireland are falling.
The year-on-year increase reflected growth of 2.4% in England and 0.9% in Wales, which were offset by declines of 0.2% in Scotland and 5.4% in Northern Ireland.
Annual house price increases in England were driven by a 5.5% rise in London and a 3.0% increase in the East.
Excluding London and the South East, UK house prices increased by 1.2% in the 12 months to January 2013.
On a seasonally adjusted basis, UK house prices fell by 0.7% between December 2012 and January 2013.
In January 2013, prices paid by first-time buyers were 2.0% higher on average than in January 2012. For owner-occupiers (existing owners) prices increased by 2.2% for the same period.
About this statistical bulletin
The Office for National Statistics (ONS) House Price Index (HPI), previously published by the Department for Communities and Local Government (DCLG), is a monthly release that publishes figures for mix-adjusted average house prices and house price indices for the UK, its component countries and regions. The index is calculated using mortgage financed transactions that are collected via the Regulated Mortgage Survey by the Council of Mortgage Lenders. These cover the majority of mortgage lenders in the UK. The HPI complements other measures of inflation published
David Brown, commercial director of LSL Property Services comments:
“Increasing house prices may point to improved confidence in the housing market, but it is clear that many prospective buyers are still feeling the financial squeeze as they look to meet lenders’ deposit requirements. The average first time buyer in the UK will have to shell out around £3,500 more for their first home than in January last year.
As a result, to put together just a 20% deposit, new buyers will have to save nearly sixty pounds a month extra just to keep up with rising prices - at a time when inflation is growing once again. Whatever treats the Chancellor has up his sleeve tomorrow, and even with a marginal improvement in the mortgage market, the reality is still incredibly tough for the vast majority of first time buyers. With a fundamental lack of new homes, as well as the ongoing difficulty buyers have in securing mortgage finance, the rental market will continue to grow to fill the gap – and we will see even stronger tenant demand in the longer-term."
