Continuing UK home price recovery pushes average value above £250,000

Values up for sixth month in a row, with average topping £250,000 for first time and six of 10 regions tracked seeing increases

PUBLISHED : Wednesday, 19 June, 2013, 12:00am
UPDATED : Wednesday, 19 June, 2013, 5:59am

Home sellers in Britain raised asking prices for a sixth consecutive month, pushing average values above £250,000 (HK$3 million) for the first time.

Prices sought rose 1.2 per cent in June to an average £252,798, property website operator Rightmove said in a report on Monday. The biggest increase in the year so far has been in the southeast, where asking prices have risen 14.8 per cent.

The report is the latest to show strength in the housing market, after Acadametrics and LSL Property Services said last week that prices rose to a record. Government measures to unblock credit markets have helped a rally broaden from London, where prices reached another record, Rightmove said.

"These increases, along with reports from agents and developers of a pickup in transactions, suggest a wider and more sustainable recovery as the price buoyancy of the London market shows signs of spreading across the country," the report said.

Prices are up 2.7 per cent from a year earlier, Monday's report shows. Of the 10 regions tracked by Rightmove, six showed increases, led by a 1.7 per cent gain in the northwest. The biggest decline was in East Anglia, where asking prices fell 0.8 per cent.

The 1.1 per cent gain in the capital took average prices to £515,243. The biggest increase in London was in Camden, where prices rose 4.9 per cent from May to an average £1.1 million.

In England and Wales, asking prices rose 10.4 per cent in the first six months of the year. All regions showed gains, with the smallest posted by the East Midlands, at 5.8 per cent. London increased 10.9 per cent.

Bank of England markets director Paul Fisher said last week that a supply shortage was helping to keep prices high, and a pickup in transactions was needed in the market.

"I do have some concerns that the level of real house prices is still high," he said in a speech in London last week. "The best form of adjustment would really be to have more real wage growth than excessive house price growth and bring down the cost of housing that way."

Chancellor of the Exchequer George Osborne and Bank of England governor Mervyn King last year announced a Funding for Lending plan to give banks that improve lending cheap access to finance. Data so far shows that net lending has still not turned positive, though some mortgage rates have dropped.