London sales drive house prices in England and Wales

House price change in England and Wales remained positive for residential property transactions that completed in June 2007.

The 0.4 per cent rate of monthly increase is slightly less than the previous month. The change raises this month’s average house price to £181,039. The annual change in house prices is 9.1 per cent.

There is evidence of increased growth rate divergence between London and the rest of the country, however across England and Wales as a whole, growth remains positive.

Average annual price change

The June data shows that for the third month in a row the 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 divergence is the largest variation since early 2005, 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 4.9 per cent over the last six months.

London’s average house price for June 2007 stands at £338,950 whereas the average price for England and Wales is £181,039.

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 15.8 per cent.

The region with the lowest annual price rise is the East Midlands, with an increase of 5.5 per cent.

London experienced the highest monthly change, with an increase of 1.5 per cent.

Wales experienced the largest negative price movement this month with a change of -1.1 per cent.

Price change by county

Brighton and Hove experienced the highest annual price change with an increase of 16.3 per cent. Twenty-four other counties and unitary authorities also exhibited annual price increases of 10 per cent or more.

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

Rutland experienced the strongest monthly growth in June with an increase of 2.5 per cent.

Powys had the most significant monthly price fall during June with a movement of -2.4 per cent.

Nine county and unitary authorities exhibited no monthly price movement.

Price change by metropolitan district

The metropolitan district with the highest annual price increase is Manchester, rising by 11.7 per cent.

The highest monthly price increase was in Bury, with a rise of 1.7 per cent.

Salford experienced annual growth of 2.8 per cent, making it the lowest performing metropolitan district in terms of annual price change this month.

Barnsley experienced the largest negative monthly price movement, with a fall of 0.6 per cent.

Price change by London borough

The borough with the highest annual price increase is Kensington and Chelsea, rising by 25.7 per cent.

The borough with the highest monthly price increase is also Kensington and Chelsea, with a rise of 2.2 per cent.

Newham experienced an annual growth of 6.3 per cent, making it the lowest performing borough in terms of annual price change.

Barking and Dagenham experienced the only negative price movement this month, with a movement of -0.1 per cent.

Sales volumes

In the months January to April 2007, transaction volumes averaged 87,734 transactions per month. This is an increase from the same period last year when sales volumes averaged 87,559.

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.

Sales volumes by price range (England and Wales)

The number of properties sold in England and Wales for over £1 million increased 28 per cent between April 2006 and April 2007, from 402 to 514.

The number of properties sold in London for over £1 million increased by 20 per cent between April 2006 and April 2007, from 257 to 308.