Average UK house prices rose 11% annually to £209,685 – an astonishing rate of growth when compared with the best fixed rate ISA paying 1.85% for one year according to a new report by Sequence.
London’s house prices rose by 21% annually to £461,477 – 11 times the growth of an ISA interest rate whilst London’s sales transactions increased by 20% annually as buyers continued to flock into the market.
UK transactions remained buoyant coming into the New Year, up 18% annually with London now having almost 14 new buyers registering for every new instruction.
Mortgage availability continued to fuel the market, with the number of applications up 15% annually and the number of first time buyer applications rising by 22%.
David Plumtree, Chief Executive at Sequence, owners of 300 branches, including Barnard Marcus, William H Brown and Fox & Sons, comments:
“The property market shows no sign of slowing in the first quarter of 2014 and with the outstanding rates of annual price growth across the market (up 11% in the UK and 21% in London) it is easy to see why buyers are keen to get a foothold on the ladder. Indeed new buyer registrations grew by over a quarter annually (26%) in the UK and 28% in London.
“The property price growth we are seeing is out performing all other types of investment and is currently 11 times greater than an ISA in London, so anyone with cash in the bank is understandably looking to capitalise on the rising market. Sales transaction levels are rocketing alongside this growth, up 18% annually in the UK and 20% in London. There are now almost eight new buyers (7.7) registering for every new instruction coming onto the market across the UK, 13.9/1 in London, and it is this fierce competition which is underpinning the price growth.
“Lending criteria continues to be very strict with affordability on loans paramount, so a bubble is not being created. However, the supply of new homes remains woefully low and with interest rates now expected to remain at rock bottom until spring 2015, demand will continue to rise, with property prices following suit.”
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