According to the latest Land Registry report, house prices rose by 0.1% in March in England and Wales. However, the headline figure disguised a mixed pattern of rises and falls around the regions, showing some significant regional differences.
London kept on recording the largest increase, with prices rising by 2.5% in March alone. The annual rate of price growth in this city reached 9.6%, with the average price reaching £374,568. In contrast, prices in Middlesbrough dropped by 5.1% in March and were down 16.5% year-on-year to an average of £69,049.
Across England and Wales, prices were up by 0.9% in March 2012, but in Yorkshire, the east Midlands and the north-east and north-west of England prices were smaller than in March 2012. The biggest faller is the north-east, where values have fallen by 5.5% to an average of £97,033.
Land Registry’s report revealed sales of homes worth £1 million or more in January, with the number rising by 28% on the same month of the previous year at 610. The number of £2 million-plus properties changing hands was up 52% at 140; of these 113 were in England’s capital. In Kensington and Chelsea, the most expensive neighborhood in the United Kingdom, the average property price is now £1.1 million, 12.2% higher than in March 2012.
Figures for house purchases registered in March emphasize the huge differences of prices being paid around the regions, with the 47,600 registrations ranging from £14,000 to £12,5 million.
In recent years, the London property market has been boosted by investors from other countries who were seeking a save haven for their fortunes. The recent weakness of the pound and events in other countries have strengthened demand even further, and only recently the most expensive home in the United Kingdom went on sale at a reported £250 million.
Giles Hannah, managing director of estate agency VanHan, said cash was continuing to came into London from both domestic and overseas buyers: “International buyers, particularly from Asia, are fuelling demand for best-in-class properties and are snapping them up at 10%-14% discounts as a result of the weakness of sterling compared with their own currencies”.
“UK-based buyers are also highly active and are seeing investment in London property as an alternative to a pension, and a way of maintaining and growing their wealth. We have also witnessed a rise in French high net worth families relocating to London owing to the increased taxes in France, creating a shortage of supply in the £5m-plus bracket and fueling price rises”, he added.
Peter Rollings, chief executive of the estate agency Marsh & Parsons, said: “House price growth in London continues to surge ahead of the rest of the country with the capital continuing to operate in another realm”.
“There is no getting away from the fact that national average indices conceal significant regional differences. London is undoubtedly the big success story and is doing a good job of pulling up the national average”, also said Giles Hannah.
References: The Guardian