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UK Property Prices Increased in October
Average residential property prices in the UK increased by 0.4% in October with the typical house now costing £165,650, according to the latest figures published by Nationwide.
It means that the price of a typical home in October is 0.8% higher than one year ago, putting annual house price growth into positive territory for the first time in six months.
‘Given the challenging economic backdrop, October's data is encouraging, but it doesn't fundamentally change the picture of a housing market that is treading water. Property transaction levels remain subdued, and prices essentially flat compared to last year,’ said Robert Gardner, Nationwide's chief economist.
‘The outlook remains uncertain, but with the UK economic recovery expected to remain sluggish, house price growth is likely to remain soft in the period ahead, with prices moving sideways or drifting modestly lower over the next twelve months,’ he added.
The Nationwide report also shows that the pproportion of buying activity in more desirable neighbourhoods has edged up. ‘Overall the pattern of transactions has been fairly stable, but the data indicates that there had been an increase in the proportion of sales occurring in more affluent areas and a similar reduction in less affluent areas,’ said Gardner.
‘In particular, the proportion of house purchases in areas classified as Wealthy Achievers has risen by 3% since 2008. These areas tend to be populated by those in managerial and professional occupations, and often include larger homes in suburban and rural locations,’ he explained.
There has also been a small rise in the proportion of transactions in areas categorised as Comfortably Off. One exception to the trend is the slight fall in the proportion of activity within areas of Urban Prosperity, typically populated by well educated professionals living within major towns and cities, which may reflect the subdued number of first time buyers at present.
At the other end of the spectrum, the proportion of transactions accounted for by Hard Pressed areas has fallen by 2% since 2008.
‘This is not surprising, given the deterioration in economic conditions which is likely to have hit these areas hardest. Hard Pressed areas are characterised by lower levels of educational attainment and household incomes, and are often found within inner cities and post industrial towns,’ said Gardner