Housing market gets a boost from wealthy buyers

Victorian house

The average house price in across England and Wales rose by £367 in July - the 11th rise in the last 12 months, according to figures from Acadametrics.

Wealthy overseas buyers have been fuelling the market, according to the report.

In total, the average house price has risen by about £5,000 since last August, with the average price now 3.2% higher than a year ago at £225,769.

A seasonal rise of 5% in transactions is usually expected, but figures showed that there were 65,500 transactions in July, an unexpected 11% increase from June.

Peter Williams, chairman of Acadametrics, says one of the main reasons for this increase is the booming London market, fuelled by overseas cash buyers.

David Brown, commercial director of LSL Property Services, agrees, saying most buyer activity is being "driven from the top". 

"The housing market remains a long way away from the heights it hit before the crunch, but both prices and transactions defied the wider economic gloom in July," Brown adds.

Greater London experienced the biggest house price change, with an average increase of 11.8% in contrast to the 1% fall in house prices seen in the North West.

"While the shortage of properties on the market remains a stumbling block to a more sustained climb in transactions, it is playing a pivotal role in supporting prices in many parts of the country, boosting competition among those buyers who have been able to secure finance," says Brown.