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UPDATED: Average house price rises to £273,000

Date online: 26/05/2015

House price growth accelerated in March as the number of mortgages advanced to people buying a property increased, figures showed today.

The average cost of a British home rose by 1.1 per cent during the month to stand at £273,000, according to the Office for National Statistics.

The annual rate at which prices are rising also picked up for the first time since September last year, increasing to 9.6 per cent, up from 7.4 per cent in February.

The growth in property values is likely to have been driven by a pick up in demand, as the housing market enjoyed a spring bounce.

"It was a slow start to activity in the first couple of months of 2015 but the market started to get out of the dip in March"

There was a 16 per cent jump in the number of mortgages advanced to people buying a home in March, compared with February, according to data from the Council of Mortgage Lenders, which was also released today.

A total of 48,200 loans were taken out by people buying a new home during the month, including 23,000 mortgages which were advanced to first-time buyers, 20 per cent more than in February.

But despite the steep month-on-month increase, both figures were down on the totals recorded for March last year.

Mortgage numbers for the first quarter were also significantly below those seen in the final three months of 2014, at 131,800, a decrease of 24 per cent.

 

Paul Smee, director general of the CML, said: “It was a slow start to activity in the first couple of months of 2015 but the market started to get out of the dip in March, a trend that we think will continue as the year goes on.

 

“We will have to wait and see how the housing market reacts to the General Election result and the reduction in the risk of a prolonged period of market uncertainty which could well have been damaging to businesses and the housing market.”

 

Meanwhile, the annual rate at which house prices are rising picked up across the majority of the UK. Scotland saw the biggest increase, with year-on-year growth almost tripling to 14.6 per cent, up from 5.3 per cent in February, to stand at its highest level since July 2007.

 

There was also a 50 per cent increase in the number of mortgages advanced for house purchase in Scotland between February and March, which may reflect a rush to get sales through before Stamp Duty in Scotland was replaced by the land and building transaction tax on April 1.

 

The east also recorded double-digit price gains of 11.4 per cent, while prices were 11.2 per cent higher year-on-year in London and the south east.

 

Growth was lowest in Yorkshire and the Humber and the north east at 4.4 per cent and 4.9 per cent respectively, followed by Wales at 5.7 per cent.

 

The average cost of a home continued to be highest in London at £498,000, while it was lowest in the north east at £157,000.


 

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