PropertyAug 22 2017

Midlands enjoys house price mini-boom

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Midlands enjoys house price mini-boom
BySimon Allin

A mini house-price boom in the Midlands is offsetting slower growth in London and the south-east, according to Rightmove.

More than half of the counties with annual asking price growth above the 3.1 per cent national average in August were in the middle part of the country, compared to just a quarter in the north and a fifth in the south.

Northamptonshire led the way with 9.1 per cent growth, followed by Derbyshire (7.9 per cent) and Norfolk (7.4 per cent).

But a more subdued picture in other areas meant average UK prices slid by 0.9 per cent between July and August to £313,663.

In London, the monthly drop was 1.9 per cent.

It adds to a number of recent indicators pointing to a slowing market, with Your Move and Halifax revealing annual growth had reached a four-year low in July.

Rightmove said the declines were partly due to seasonal factors and were in line with the average for the time of year.

Miles Shipside, Rightmove director and housing market analyst, said: “A combination of traditional summertime price blues and the chill of uncertainty in the air has cooled price growth in some parts of the country, and affordability also remains very stretched. 

“But despite these factors, high demand and limited supply are still driving momentum, especially in the counties in the middle of the country.

"Here, year-on-year rises at over twice the pace of the national average are widespread, in contrast to southern and northern counties where none have approached these heady heights.”

August was the second of the past three months when average asking prices fell on a monthly basis, following a 0.1 per cent rise in July and a 0.4 per cent fall in June.

Jeremy Duncombe, director of the Legal & General Mortgage Club, called for a long-term solution to problems in the housing market.

He said: “Even if house price inflation is slowing slightly, there is still a chronic lack of suitable homes to buy and very little in the way of incentives to this.

"The campaign for stamp duty reform is starting to gain real momentum as the constraints of the tax are laid bare. 

“The issue is deterring buyers from purchasing and stopping younger families who need extra space, or older homeowners looking to downsize from moving.

"The government needs to seriously reconsider the use of stamp duty and address the ways in which it is acting as a barrier to homeownership.”