House prices rose by 7.1% on average in the year to the end of January 2016, with a typical home in England and Wales now costing £191,892, according to the latest figures.
The biggest increase was in London, where house prices increased by 13.9% in a year, putting the average price in the capital at £530,409.
The South East also witnessed double-digit figures of 10.7%, with average house prices at £266,603, the Land Registry reveals.
A north-south divide in house prices is evident, with house prices in the North East almost stagnant at 0.2%. Property prices in the North West only rose at a slightly faster rate at 2.1%.
When it comes to monthly figures, house prices in England and Wales went up by 2.5% in January. Wales had the fastest house price hike – up by 3.7% from December 2015 to January 2016, followed by London at 2.8%.
The biggest monthly drop was in the North East, at -1.6%, and in the North West, which saw monthly house prices down by -0.4%.
‘The going is getting tough for first-time buyers’
Andrew Bridges, managing director of estate agency Stirling Ackroyd, says: “The going is getting tougher for first-time buyers and anyone aiming to move towards the economic gravity of London and the South East.
“London has always been a city of mismatch – between unaffordable and affordable boroughs. But now higher prices are triumphing across a much wider area, and some buyers are left with fewer options – and less value for their money.”
House sales fall, but so do repossessions
The number of completed house sales in England and Wales fell by 2% in November 2015 with 72,163 completed house sales, compared with 73,282 in November 2014.
Meanwhile, the number of properties sold in England and Wales for more than £1 million increased by 14% to 1,091 from 953 a year earlier.
On a positive note, repossessions dropped by 54%, with 346 homes repossessed in England and Wales in November 2015, compared with 753 in November 2014.
The South West had the greatest drop in repossessions – down by 78% over the year to November 2015.
Short-term market interruption predicted
Nick Leeming, chairman at estate agency Jackson-Stops & Staff, adds: “All markets abhor a vacuum and until we know whether we are in or out of the EU there will be short-term interruption to the property market as we approach spring, as people who may previously have taken the plunge to put their home on the market hold off until the fog of uncertainty has cleared.
“The market will also be eagerly awaiting the outcome of the Budget announcement in mid-March to see what impact, if any, it has on issues such as stamp duty, buy-to-let investment and the chronic shortage of new homes.”