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House prices up again thanks to 'robust' market in South

A late spring rush from sellers, however, suggests further increases in asking prices are unlikely.

 
House prices up again thanks to 'robust' market in South

Property asking prices in England and Wales increased 1% in June, according to Rightmove.

The South West saw the biggest monthly increase, with a rise of 1.9%, closely followed by London, with an increase of 1.7%. London also reported the biggest annual rise in asking prices – up 8.8%

The West Midlands, on the other hand, experienced both the largest monthly fall in prices – down 1.8% – and the biggest annual fall, with a drop of 2.8%.

Overall, prices are up 2.4% compared to June last year, which Rightmove said is thanks to the 'robust' market in the South. Although, in real terms prices have actually fallen considerably, added Rightmove, with London the only region to boast an inflation-busting increase over the last five years.

‘Property has a track record of being a hedge against inflation and continues to be seen as such. However, whilst it has fared better than many investments in the last five years, it has failed to hold its own in real terms in most parts of the country,’ said Miles Shipside, director at Rightmove.

'This reduction in real house prices would be great news for home-movers if their wages had kept pace with inflation and the return of mass-market mortgage finance was just around the corner,’ he added. ‘However, the reality is wage freezes, rising costs of living, and continuing tight mortgage funding have squeezed affordability for many buyers’.

Looking forward, meanwhile, Shipside said that we’ve likely seen the last of record asking prices for this year.

A late spring rush in the three weeks prior to the Diamond Jubilee bank holiday saw the highest amount of sellers come to market for two years. With buyers traditionally more scarce in summer, this suggests further increases in asking prices are unlikely.  

The average property asking price is now £246,235 – up from £243,759 in May.

9 comments so far. Why not have your say?

alan franklin

Jun 18, 2012 at 07:51

It's lack of supply that is causing prices to rise in the south east, which in turn is caused by lack of building land and incredibly complex building and planning regs, which get ever more nightmarish.

Yet another layer of expense has been added by the water companies taking over private sewers. We just sent off a cheque for £343 to Thames Water so they can come and look at a drain in our garden.

We are building close to a minor sewer, which takes waste from one other house, so now have to be embroiled in yet another inspection.

Then comes the bat survey, the tree inspection and all the other ridiculous rubbish you have to go through in the years it often takes before a brick can be laid. The last plan we got passed required interfering busybodies from the planning dept to come and see if our garden planting programme met their approval "Now, how many daffodils do you plan to plant?" Actually, I'd like to plant them, preferably head first in a sludge pit.

Re-use a perfectly good and expensive nine year old double-glazed window? Not on your life" Not FENSA registered. Bank goes another £700. And so on. The as-new window will go in the skip.

Builders and architects are driven crazy by all this nonsense, which adds tens of thousands to the cost of homes. One experienced architect, who has battled for two years to get all the approvals to build a couple of semis in Berkshire, told me that council planning departmenrs are staffed "by young girls with geography degrees."

Planners for the most part couldn't plan their way out of wet paper bags, as a glance at the changing fashions over the past 50 years shows. Remember when concrete buildings and cladding (which leaked) were all the rage? Plus all the schools and hospitals built with flat roofs? Guess what has happened to them.Yes, I spent years reporting on planning committee meetings so know the kind of imbeciles who decide these things. (What's your view, councillor windbag?)

Of course prices are out of reach for young people. It is entirely the fault of vast amounts of restrictive legislation, wrapped round the building industry like a large, heavy, waterlogged blanket.

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John Lacy

Jun 18, 2012 at 13:17

Asking prices are just for show-----Let's see what the selling prices are before we get too excited

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Rose G

Jun 18, 2012 at 13:17

Successive governments have done very little to address the housing shortage and guess what, how many politicians have benefited from the increased house prices - I would imagine all of them did and still continue to do so.

Let's face it, we are just mugs putting up with every little bit of our freedoms taken away from us; we are walking onwards into a nanny state that is so full of contradictions, only when the policies come to light and are fully analysed outside of governments, do the downsides seem apparent.

Instead of the current lot of useless space occupying lesions so-called coalition government, why do we not boycott their policies and take more direct action to get rid of those who are just lining up their pockets for doing very little but shuffle in and out of westminster, making lots of noise to camouflage their lack of understanding of even the most basic sums.

Housebuilding should be taking place on a huge scale, especially in London & the South east - that is where most of the jobs are and where most people in work are - the previous governments have made sure that most of the industries in the North have been closed down & this too affects house prices.

It is bizarre that we are beng taxed to the limit, while those who make the policies seem to benefit most from them - no change there then!

As for developers, why do they think it is ok to sit on land for development and only build when conditions suit them. House building has to be a bigger priority but while we have the current lot in government pretending to govern, or the next lot who will be no better, young people will struggle to get a decent standard of housing for their money - very few family homes are being built by private developers, next to no houses are being built by local authorities, so off course, this policy ensures house prices keep going up.

As for some of the new builds, China could now probably compete with us in terms of standards/quality/size - no regulations about size of rooms, etc.

Regulations maybe bad for developers but is necessary if we do not want to live in high priced chicken coops.

The planning laws are a bit daft, but that is why housing remains a costly expense for nearly half the population in the UK - the other half already own properties and are happy that there is no legislation whatsoever on what rents are being charged.

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Clive B

Jun 18, 2012 at 14:12

John Lacy

"Asking prices are just for show-----Let's see what the selling prices are before we get too excited"

I just looked up my postcode on Land Registry (which I believe records sale price), and it shows prices in Apr 2012 about 4% off their May 2008 highwater mark. Also shows they've been pretty much flat since late 2010 (slight dip, then recovered)

http://www.landregistry.gov.uk/public/house-prices-and-sales/search-the-index

Clive

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joe stalin

Jun 18, 2012 at 15:10

well well so when are we going to get this collapse that the doommongers have ben harping on about? 4% down from 2008 high water mark? Hardly a catastrophy. I would say that that is pretty robust given what has hapened over the last four years and further proof that the muppets that have been crying price armagedon on this board are out with fairies and should be treated as such even after adjusting for inflation but taking into consideration that data is bound to have been skewed by speculative activity in the Midlands and North East.

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Bob Smith

Jun 18, 2012 at 16:40

Alan Franklin has got it spot on. We either need to build more homes or we don't. If we DO need to build more homes then the last thing we need is a load of over paid under qualified inexperienced council beaurocrats making it difficult/impossible for the building trade to deliver. We pay their salaries and they SHOULD be there to help and guide. Instead they seem to regard anyone who WANTS to build more homes as the enemy from day one.

I've recently had a pre-planning application failed having fallen foul of the new policy on 'back garden development'. Of course there were abuses of this type of development in the past but now decisions on this type of development are ENTIRELY in the hands of the local council planners with little or no right of appeal. In this particular case I wished to demolish a (very) delapidated detached house with a truly huge garden and put eight flats and a coachhouse on the site, which has access from TWO public highways.

A few years ago I would have been applauded. Providing work for many people and trade for local builder's merchants and providing the council with an ongoing council tax revenue stream many many times greater than their current single occupier discounted council tax take.

Nine affordable new homes against one unaffordable rotten heap that no one is going to refurbish. The costs just don't add up.

My own experience is FAR from unique.

And as long as supply is so effectively stifled then demand WILL finally and inevitably force prices up. Or am I missing something Alan ? Maybe a degree in geography ?

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Sinic

Jun 18, 2012 at 16:56

Alan Franklin is spot on. If it wasn't so damaging it would be funny. Of course a fair few of Gordon Brown's million or so extra public sector non-jobs ended up in planning and conservation departments and relevant sub-contractors.

Clive B., 4% decrease in the direct cost of housing between 2008 and 2012 may not seem much but in real terms after inflation it is closer to 20%.

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engineertony

Jun 18, 2012 at 17:26

Have land prices fallen?

Have builders' wage costs fallen?

Is there still a skill shortage?

Have building materials gotten cheaper?

Is the red tape hassle & nonsense from the local government any different?

Are building connection charges for water, sewage, electricity, telephone/broadband any cheaper?

Is supply outstripping demand?

Why should house prices not rise?

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gerob76 via mobile

Jun 18, 2012 at 20:34

After a three year delay caused by one senior planner who took a dislike to our roof design, we are finally building a house. Only now we have a full blown economic crisis to mess things up.

Largely agree with Alan. Planners should specify one local characteristic, the only other factor should be impact on neighbours. Current system virtually ignores this last factor while dwelling on a multitude of silly time consuming and money wasting hurdles that no-one else gives a damn about.

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