UK House Prices - February 2014
According to recent reports in the media, the average UK house price has now reached £250,000 which will push thousands of properties into the 3% stamp duty bracket.
Due to the dip in the UK economy, new builds have slowed down to a point where the prices have been pushed up for existing properties making it quite difficult for first time buyers and existing property owners alike.
According to statistics, In January, average asking prices rose to £243,861 which is an increase of 1% within a month. According to Rightmove, the rise is the highest that has ever been recorded for properties coming to the market.
Due to a 12.3% price increase to properties in London, The Office for National Statistics – (OFNS) have quoted that in December, house prices were 5.5% higher all across the UK compared to what they were in 2013. This has led the Treasury to come under fire, as properties with a value of £250,000 and above are subject to a rate increase from 1% to 3%, meaning the buyers have an increased bill from £2,500 to a whopping £7,500.
According to the OFNS, in December, house prices were up 4.8% in Wales and Northern Ireland, 5.7% in England and just half a percent in Scotland. Unfortunately, this rise is catching out most buyers leading them to be forced into paying the higher rate bill. These figures also show that first time buyers were paying on average of 7.4% more for the same property than they did in December of the previous year with existing home owners paying an additional 4.7% rise during the same period.
It is true however, that in some areas, your £250,000 could possibly go a lot further than before. An example of this is for the same money, you can purchase a 4 bedroom property in Glasgow, Scotland, or a 3 bedroom property in North Yorkshire, or a 2 bedroom apartment in London. Although the worry is that the lack of properties around the capital and the South is really contributing towards pushing the average house price upwards.
Is there an end to the uprising any time soon? Not according to the OFNS and Rightmove. But they also agree that the interest in new properties and house moves has risen, in some cases as much as 20%, due to many new buyers having easier access to house hunting with tablets and smart phones.
The stamp duty will be discussed in March with an aim to bring house prices down for first time buyers and existing owners alike, but some MP’s would rather see the stamp duty scrapped altogether on properties with a value of £500,000 or less. Whether this will become a reality in a way to help new home owners get a step up on the property ladder remains to be seen.