House prices have risen over the past year despite a fall in the number of sales with the average London home costing over £300,000, according to the latest Land Registry figures.
The July to September figures suggest the average house price in England and Wales is £194,589, an average rise of 3.53% from £187,971 for the same period in 2004.
But the volume of sales in England and Wales decreased by 15.41% from 309,101 in 2004 to 261,481 in 2005.
The survey also shows 1,140 properties worth over £1m were sold in the 2005 quarter compared to 1,230 in 2004, and 78,559 properties under £120,000 were sold compared to 95,190 in 2004.
In Greater London, the average property price increased by 4.47% from £287,470 in 2004 to £300,329 in 2005, while the volume of sales decreased by 15.87% from 39,692 to 33,393. According to the Land Registry, 634 properties worth over £1m were sold in Greater London compared to 727 in 2004.
The area which shows the greatest rise in house prices is Wales, increasing by 7.42% from £135,162 in 2004 to £145,188 in 2005.
Milan Khatri, RICS chief economist, says: “The drop in inflation contrasts with figures released by mortgage lenders in the last few months which showed an upturn in price rises. This is unsurprising since the Land Registry figures are based on completion prices, which are recorded several months after sales have been agreed.”
He adds the recent upturn in agreed sale prices is unlikely to be fully evident in the Land Registry statistics until the fourth quarter.
The fall in completed sales is “consistent with recent evidence that housing market activity has shown a rebound following the August interest rate cut,” says Khatri.
More recent RICS statistics show buyers have become more confident as the predicted housing market crash has failed to transpire, he adds.
Khatri continues: “RICS expects the upturn in housing activity to be sustained, supported by steady growth in the number of jobs and incomes. However, with further significant interest rate cuts unlikely in the foreseeable future, a renewed housing market boom is quite unlikely.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7968 4554 or email [email protected].IFAonline
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