New data released by the Nationwide reveals that UK house prices increased by 0.4% in March 2014 and were 9.5% higher than March 2013. This means that average house prices are now around 3% below the peak values of 2007.
The relatively small increase in prices in March shows that growth, over the month of March at least, has slowed somewhat, with growth figures for January and February being 0.7% and 0.8% respectively.
The Nationwide’s chief economist Bob Gardner believes that low mortgage rates, improved availability of credit and the brighter economic outlook are all leading to increased demand for housing. The difficulty, however, is that the upturn in the supply side of the market continues to lag far behind.
While all thirteen regions of the UK saw annual price growth in the first quarter of 2014 it is notable that the southern regions of the UK continue to out-perform the others. London in particular has experienced rapid growth with prices up 18% in the first quarter of this year compared to the first quarter of 2013.
“Overall, the southern regions have been outperforming for some time, with the result that house prices in London, the Outer Metropolitan and Outer South East have now surpassed their pre-crisis peaks, “ said Mr Gardner. “Similarly, East Anglia and the South West are less than 5% below their 2007 highs. By contrast, the North of England, Wales, Scotland and Northern Ireland still have more ground left to recover.”
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