London sales continue to drive house prices in May

London's average house price for May 2007 stands at £335,658 whereas the average price for England and Wales is £180,594, increasing the index to 219.6, according to Land Registry data.

This is an annual increase of 8.9 per cent and up 0.7 per cent on April's figures when the average price was £179,935.

Average annual price change

The May data shows the current rate of increase for London house prices remains over six per cent per annum greater than that of England and Wales as a whole. This recent divergence is the largest variation in two years, when London lagged behind the rest of the country by approximately six per cent. The divide in annual growth between London and England and Wales has averaged 4.3 per cent over the last six months.

London’s average house price for May 2007 stands at £335,658 whereas the average price for England and Wales is £180,594.

Price change by region

All regions in England and Wales experienced increases in their average price over the last twelve months.

The region with the highest annual price change is London with an increase of 15.3 per cent.

The region with the lowest annual price rise is the North East, with an increase of 4.8 per cent.

Yorkshire & The Humber experienced the highest monthly change, with an increase of 1.9 per cent.

The North East experienced the largest negative price movement this month with a change of -0.7 per cent.

Price change by county

Brighton and Hove experienced the highest annual price change with an increase of 16.5 per cent. Twenty-one other counties and unitary authorities also exhibited annual price increases of over 10 per cent.

No county or unitary authority experienced negative annual price change this month.

Neath Port Talbot experienced the strongest monthly growth in May with an increase of 2.4 per cent.

Torfaen had the most significant monthly price fall during April with a movement of -2.2 per cent.

North Lincolnshire, York, Cumbria, Somerset, Tyne and Wear and Blackpool all exhibited no monthly price movement.

Price change by metropolitan district

The metropolitan district with the highest annual price increase is Oldham, rising by 10.9 per cent.

The highest monthly price increase was also in Oldham, with a rise of 2.6 per cent.

South Tyneside experienced annual growth of 0.3 per cent, making it the lowest performing metropolitan district in terms of annual price change this month.

Bury experienced the largest negative monthly price movement, with a fall of 1.7 per cent.

Price change by London borough

The borough with the highest annual price increase is Kensington and Chelsea, rising by 23.4 per cent.

The borough with the highest monthly price increase was Camden, with a rise of 2.3 per cent.

Newham experienced an annual growth of 5.0 per cent, making it the lowest performing borough in terms of annual price change.

Greenwich and Enfield experienced the lowest monthly price movement, with a movement of 0.1 per cent.

Sales volumes

In the months December 2006 to March 2007, transaction volumes averaged 94,091 transactions per month. This is an increase from the same period last year when sales volumes averaged 90,195.

The pattern of transaction volumes in London continues to mirror the rest of the country.

Price index volatility is greater in areas where recorded sales volumes are low. Index volatility leads to erratic and high changes in price.

Some of the areas that typically have very low transaction volumes include but are not limited to the following: City of London, Rutland, Isle of Anglesey, Merthyr Tydfil, Blaenau Gwent, Ceredigion and Torfaen.

Data for the two most recent months are not used as comparisons due to the lag in the registration of sold properties.

Sales volumes by price range (England and Wales)

The number of properties sold in England and Wales for over £1 million increased 32 per cent between March 2006 and March 2007, from 428 to 566.

Sales volumes by price range (London)

The number of properties sold in London for over £1 million increased by 14 per cent between March 2006 and March 2007, from 276 to 314.