March figures show moderation in house price growth
Latest figures show a moderation in house price rises during March but reveal a growing gap between London and the rest of the UK.Prices rose by 0.4 per cent during March, according to the Nationwide House Price Index. They are now 9.5 per cent higher than they were one year ago and three per cent below the pre-recession peak recorded in 2007.This takes the average cost of a house to £180,264, compared with £177,846 in March 2013.There was a slowing in the rate of growth, however, which was down from the 0.7 per cent recorded during February and 0.8 per cent in January.Earlier this week, the Bank of England revealed a dip in mortgage approvals during February - although it is thought the exceptionally bad weather may have contributed to the figures.Robert Gardner, Nationwide's chief economist, said demand for housing is being fuelled by record low mortgage rates, the improved availability of credit and a brighter economic outlook.Supply is failing to keep pace with demand, however, with the number of new homes being built in England 40 per cent below pre-crisis levels.While price rises occurred in all 13 regions for the third quarter in a row, southern regions showed the most rapid gains."London house prices were up 18 per cent year on year in Q1, taking the price of a typical home in the capital to £362,699 - more than twice the level prevailing in the rest of the UK when London is excluded," Mr Gardner commented "Indeed, the gap between house prices in London and the rest of the UK is the widest it's ever been," he added.House prices in the capital, the outer metropolitan and the outer south-east have now surpassed their pre-crisis peaks, the index shows.Levels in East Anglia and the south-west are only slightly below pre-recession levels, while the rest of the UK has some ground left to cover.
--- Ends ---