Mortgages  

Property prices rising fastest since 2006

Further strengthening claims that the housing market had turned a corner, data from the Residential Market Survey published by the Royal Institution of Chartered Surveyors revealed that house prices had risen for the fourth consecutive month.

Figures from the Office for National Statistics’ House Price Index also revealed average prices rose by 3.1 per cent in the 12 months to June 2013, up from 2.9 per cent in the 12 months to June.

The year-on-year increase reflected growth of 3.3 per cent in England and 4.3 per cent in Wales, offset by falls of 0.9 per cent in Scotland and 0.4 per cent in Northern Ireland.

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The ONS also revealed that prices paid by first-time buyers were 3.9 per cent higher on average than in June 2012. For owner-occupiers, prices increased 2.7 per cent for the same period.

Matthew Pointon, a property economist for Capital Economics, said: “The housing market has fundamentally picked up in the past six months due to record mortgage rates which is due, in no small part, to the FLS and the Help to Buy scheme, which has given the market a boost.

“We’re not of the view that this is going to turn into a house boom. It’s hard to see how much higher house prices can be sustained.”

Peter Williams, executive director of the Intermediary Mortgage Lenders Association, said: “The increasing growth rate of house prices still needs to prompt house builders into greater action if we are to avoid a growing demand and supply mismatch.”

Meanwhile, an FCA spokesman has confirmed that three unnamed firms are awaiting regulatory approval to become mortgage lenders, while lender Magellan Homeloans launched into the market last week.

A wave of new mortgage lenders could enter the market on the back of increasing mortgage prices and easier access to credit, industry experts have claimed.

A wave of new mortgage lenders could enter the market on the back of increasing mortgage prices and easier access to credit, industry experts have claimed.

Commenting on reports that three mortgage lenders were awaiting regulatory approval to start offering customers mortgages, Oliver Whitehead, managing director of London-based mortgage intermediary Oportfolio, said: “The market certainly wants more competition. It became harder and harder for new lenders