Average UK house prices increased by 7.9 per cent over the year to January, up from 6.7 per cent in the year to December, according to the latest Office for National Statistics index.
On a seasonally adjusted basis, average house prices increased by 0.9 per cent between December and January, compared with a decrease of 0.3 per cent in average prices during the same period a year earlier.
The average price for properties bought by first-time buyers increased by 7.7 per cent over the year to January, up from an increase of 6.4 per cent in the year to December.
The average price paid for a house by a former owner-occupier was £340,000, while the average price paid for a house by a first-time buyer was £222,000 and the overall average UK mix-adjusted house price in January was £292,000.
The average price for properties bought by existing owners increased by 8 per cent in the year to January, up from an increase of 6.9 per cent in the year to December.
Across the UK there was a varying picture, with average house prices rising over the year to January by 8.6 per cent in England (up from 7.3 per cent in the year to December), 0.1 per cent in Scotland (up from minus 0.2 per cent) and 0.8 per cent in Northern Ireland (down from 1.5 per cent).
There was a 0.3 per cent decrease in average house prices in Wales (down from a 1 per cent increase in the year to December).
Regionally within England, there was also much variance in January, with the largest annual increase coming in the south east at 11.7 per cent (up from 8.8 per cent in the year to December), followed by London (a 10.8 per cent increase in the year to January, up from 9.4 per cent in the year to December).
The north east continued to have the lowest annual growth of the nine regions, with prices increasing 0.9 per cent in the year to January (unchanged from 0.9 per cent in the year to December).
Excluding London and the south east, UK house prices increased by 5.1 per cent over the year to January, up from 4.6 per cent in the year to December.
Jeremy Leaf, a former Royal Institution of Chartered Surveyors’ chairman and north London estate agent, said the January jump in house prices reflects a busy period for the housing market, with the pace of transactions picking up as investors hurried through purchases ahead of the stamp duty hike in April.
He said: “Would-be sellers, attracted by the increase in demand for property at the turn of the year as buyers attempt to beat the rise in stamp duty, have flocked to list property, resulting in a much higher than usual number of listings.
“If those sellers now stay in the market, prices will decline because of reduced demand, now that buying decisions have been brought forward from the second quarter of the year to the first quarter.”
The ONS also gave an update on the development of a single, official house price index, stating that the methodology has now been finalised.
An Official House Price Index user event is due to be held in London on 30 March, at which the historic time series will be presented, comparing these new estimates with existing estimates of average house prices and house price growth.
Scheduled to be first published in their entirety in June, these new statistics will replace the existing indices published separately by ONS and Land Registry.
peter.walker@ft.com
