New house price gap narrows

The gap between the average price of new homes sold in Scotland and England has narrowed to just one per cent, according to figures released by NHBC, the new home warranty and insurance provider in the UK.

The average price of a new home in England in February 2007 was £187,000 compared with £185,360 in Scotland. NHBC figures show that the average price of a new home in Scotland has accelerated by 16 per cent in the last year from 160,000 in February 2006.

In addition, the average price of a new home in Northern Ireland is beginning to rival those in England, as NHBC statistics show that the average price of a new home rocketed to £185,000 in February this year, compared to £129,000 in February last year.

Also the number of new homes started across the UK increased year-on-year in the period from December 2006 to February 2007. NHBC statistics show that 45,613 new homes were started - an eight per cent increase on the same three month period a year ago (42,125). Of that total, 37,529 related to private sector activity (i.e. excluding housing associations), showing a two per cent increase on the same period a year ago (36,938).

Housing association volumes, which have dominated the headlines over issues on affordability and key worker housing, have leapt by more than half.
Starts totalled 8,084 in the three months to the end of February 2007 – an increase of 56 per cent on the same period a year ago (5,187).

Imtiaz Farookhi, NHBC Chief Executive, says: "February's average new house price figure showed a strong year-on-year rise across the UK, particularly in Scotland and Northern Ireland, as the demand for new homes continues to push up house prices. In terms of supply, there was an increase in house building activity during the three months to the end of February, with the largest percentage increases in new home starts in Wales, North East and Greater London."

Additional figures for the three months from December 2006 to February 2007 reveal the average number of new homes sold each day in the UK was 724, an increase of 27 per on the same period a year ago (568).