UK house prices increased by 6.1 per cent in the year to September, up from 5.5 per cent in the year to August, according to the latest Office for National Statistics house price index.
This means the average UK mix-adjusted house price in September was £286,000.
House price annual inflation was 6.4 per cent in England, 10.2 per cent in Northern Ireland and 1.1 per cent in both Scotland and Wales.
Annual house price increases in England were driven by an annual increase in the east (8.4 per cent) and the south east (7.4 per cent).
Excluding London and the south east, UK house prices increased by 5 per cent in the 12 months to September.
On a seasonally adjusted basis, average house prices increased by 0.8 per cent between August and September, while year-on-year, prices paid by first-time buyers were 4.3 per cent higher on average.
For owner-occupiers existing owners, prices increased 6.9 per cent for the same period.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said with lenders keeping an eye on meeting their year-end targets, there are some very competitive deals to tempt borrowers.
“There are an increasing number of options for first-time buyers with many lenders offering high loan-to-value deals.
“However, with the average price paid by a first-time buyer now £216,000, that still means saving at least £11,000 for a deposit, plus moving costs, and a salary of around £50,000.”
Jeremy Leaf, former Rics’ chairman and north London estate agent, explained that demand for home ownership is high but affordability is a problem.
“With the average property price in London now £531,000, unless you earn way above the national average salary, you have precious little hope of being in a position to buy.
“‘Generation Rent’ is being left out in the cold: they have aspirations to buy but are being pushed further away from their goal.”
Jeremy Duncombe, director of Legal and General’s Mortgage Club, added that property prices picked up in September following the more subdued increases seen during the summer months.
“Given the increase in demand, and that supply remains limited, we expect house price growth to climb further in the final quarter of the year,” he added.
peter.walker@ft.com
