LSL / Acadata Wales HPI News Release

Welsh house prices rise by £1,125 in October

  • Average house prices up £3,137 since start of 2013
  • Sales at highest level since December 2007
  • New record average price in Cardiff, up 7.4% annually

House Price

Index

Monthly Change %

Annual Change %

£154,696

240.0

0.7

1.4

Richard Sexton, director of e.surv chartered surveyors, part of LSL Property Services, comments: “The housing market in Wales has turned over a new leaf and is clearly entering a new phase, with pent up demand and strong competition driving house price growth and rising sales. The market is powering ahead, with prices increasing by £1,125 compared to September, representing the third monthly price rise, while prices are up by £3,137 since January 2013. New buyer enquiries, sales and price expectations are all above the three-month average illustrating the strong headway being made.

 “Sales in particular are now standing at the highest level since December 2007, and momentum is building further – thanks to the boost in consumer confidence and the improving economic picture. Now that mortgage rates have dropped to record lows, aspiring homeowners are starting to have more chance to put together the money required for a deposit. As a result there are bursts of first time buyers pouring into the market with much more zeal, with Wales has seen a higher loan-to-value ratio than elsewhere in the UK. While there’s an improvement in the home movers sector of the market too.

“First-time buyer homes are proving particularly popular in Cardiff. Prices in the capital are up 7.4% on the year, setting a new record price, while many other parts of Wales remain more subdued. Without doubt, Cardiff is a different kettle of fish from London and South Wales is no South East of England, but as a whole the housing market in Wales is making strong strides forward nonetheless. Regionally however, some areas do differ more than others in terms of performance due to their local economies. Wage growth is still slow, and across Wales this will prevent prices from rising too quickly.

“What’s key is that we see steady, house price growth to ensure sustainable growth. When it launches on 2nd January, the Help to Buy Wales shared equity scheme will provide a new opportunity for first- time buyers and existing home owners on new-build properties. But as the scheme is geared up at new-build properties, which represent only a smaller proportion of total housing sales, we expect the scheme will not – by and large – drastically affect overall prices.

“However house-building in Wales is still below pre-recession levels and this supply remains an area that needs to be addressed in order to continue the positive growth. While, the UK Government’s decision to withdraw the Funding for Lending scheme indicates that the more recently announced Help to Buy schemes are offering significant support to the sector, more can be done. In the coming year much will be determined by the development of the jobs market in Wales.”

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