House prices top previous August 2008 peak

Even wealthiest in UK are now worried that their children won't be able to afford a house, claims new report

Latest figures from the Office for National Statistics (ONS) show that between August 2012 and August 2013, house prices rose 3.8 per cent, meaning that they are now above their previous January 2008 high.

The price data follows the latest Family Futures Survey by YouGov Plc for Lloyds Bank Private Banking which reveals that even wealthier parents who plan on helping their children buy their first property are concerned that they can’t afford to.

Around 57 per cent of parents with more than £100,000 of investable assets (excluding their main residence and pension) have either helped their children buy a property or plan on doing so, but 59 per cent think their children will still struggle to buy a property.

Parents in the North West and North East are most concerned (70 and 69 per cent respectively), while those in the East Midlands, the South East and London are least worried (52, 54 and 59 per cent respectively).

The research also shows that 4 per cent of wealthier grandparents have supported the 'bank of mum and dad' by giving their grandchildren financial assistance to buy a house.  16 per cent of parents who own more than one home do so for a family member to live there, a figure that rises to 25 per cent in London.

Nitesh Patel, Housing Economist at Lloyds Bank Private Banking, said: “Low interest rates, better availability of finance and a shortage of housing supply are contributing to house price increases across many parts of the country. Annual double digit growth in house price increases has returned to a few areas of London, but these areas are the exception rather than the rule with much more modest rises in most areas.   Despite improvements in affordability over the past few years, house prices remain above their long-term average in relation to earnings. The recent pick-up in house prices means that even wealthier parents are concerned about whether they can help lift their children onto the property ladder."

A separate report from the Wesleyan Assurance Society suggests that 81 per cent of professionals believe they will have to support their children financially well into adulthood. Samantha Porter, Wesleyan's Sales and Marketing Director, said: "There is no doubt that life is tough for this generation of young adults. They are leaving university with significant debt and have to raise a much larger deposit on their first home compared to their parents.

"However, it's also tough on parents as they find themselves supporting their children for much longer than they may have expected. They are also facing financial challenges themselves with changes to pensions and an increased cost of living.

The ONS figures indicate year-on-year price growth of 4.1 per cent in England, 1.1 per cent in Northern Ireland and 1 per cent in Wales, offset by a fall of 0.7 per cent in Scotland. Increases in England were driven by London (8.7 per cent), the East Midlands (3.8 per cent) and the West Midlands (3.5 per cent). Excluding London and the South East, UK house prices increased by 2.1 per cent .

In August 2013, prices paid by first-time buyers were 4.9 per cent higher on average than in August 2012.

Nicholas Ayre, managing director of home buying agency Home Fusion, said: "Supply constraints are such that if Help to Buy really did take off then a housing bubble might be possible. If more flats and houses are not built, a significant spike in mortgage transactions could substantially push up house prices. But we are nowhere near that just yet. While the recovery in property prices in London continues apace, this is far from the case throughout the UK. It is also worth remembering that transaction levels remain very low compared with what they were at the height of the housing boom.

"London continues to be a special case that almost needs its own house-price index, with no sign of a slowdown in price rises in the capital."

Discover more property articles at Homes and Property
News
The cartoon produced by Bruce MacKinnon for the Halifax Chronicle-Herald on Thursday, showing the bronze soldiers of the war memorial in Ottawa welcoming Corporal Cirillo into their midst
news
Voices
Funds raised from the sale of poppies help the members of the armed forces with financial difficulties
voicesLindsey German: The best way of protecting soldiers is to stop sending them into disastrous conflicts
Voices
Nigel Farage has backed DJ Mike Read's new Ukip song
voicesNigel Farage: Where is the Left’s outrage over the sexual abuse of girls in the North of England?
Property
One bedroom terraced house for sale, Richmond Avenue, Islington, London N1. On with Winkworths for £275,000.
property
PROMOTED VIDEO
Life and Style
Text messaging changes as a relationship evolves
life
News
The comedian, 42, made the controversial comment following the athlete’s sentencing to five years for the culpable homicide of Reeva Steenkamp on Tuesday
peopleComedian's quip about Reeva Steenkamp was less than well received at music magazine awards
Sport
Cristiano Ronaldo in action for Real Madrid
football
News
peoplePerformer had recently been diagnosed with prostate cancer
Life and Style
food + drink
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

SSRS Report Developer - Urgent Contract - London - £300pd

£300 Per Annum: Clearwater People Solutions Ltd: SSRS Report Developer – 3 Mon...

KS1 Teacher

£95 - £150 per day: Randstad Education Birmingham: Key Stage 1 teacher require...

HR Business Partner - Essex - £39,000 plus benefits

£32000 - £39000 per annum + benefits + bonus: Ashdown Group: Generalist HR Man...

Trainee Recruitment Consultant

£18000 - £30000 per annum + uncapped: SThree: Do you feel like your sales role...

Day In a Page

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker
Renée Zellweger's real crime has been to age in an industry that prizes women's youth over humanity

'Renée Zellweger's real crime was to age'

The actress's altered appearance raised eyebrows at Elle's Women in Hollywood awards on Monday
From Cinderella to The Jungle Book, Disney plans live-action remakes of animated classics

Disney plans live-action remakes of animated classics

From Cinderella to The Jungle Book, Patrick Grafton-Green wonders if they can ever recapture the old magic
Thousands of teenagers to visit battlefields of the First World War in new Government scheme

Pupils to visit First World War battlefields

A new Government scheme aims to bring the the horrors of the conflict to life over the next five years
The 10 best smartphone accessories

Make the most of your mobile: 10 best smartphone accessories

Try these add-ons for everything from secret charging to making sure you never lose your keys again
Mario Balotelli substituted at half-time against Real Madrid: Was this shirt swapping the real reason?

Liverpool v Real Madrid

Mario Balotelli substituted at half-time. Was shirt swapping the real reason?
West Indies tour of India: Hurricane set to sweep Windies into the shadows

Hurricane set to sweep Windies into the shadows

Decision to pull out of India tour leaves the WICB fighting for its existence with an off-field storm building
Indiana serial killer? Man arrested for murdering teenage prostitute confesses to six other murders - and police fear there could be many more

A new American serial killer?

Police fear man arrested for murder of teen prostitute could be responsible for killing spree dating back 20 years
Sweetie, the fake 10-year-old girl designed to catch online predators, claims her first scalp

Sting to trap paedophiles may not carry weight in UK courts

Computer image of ‘Sweetie’ represented entrapment, experts say
Fukushima nuclear crisis: Evacuees still stuck in cramped emergency housing three years on - and may never return home

Return to Fukushima – a land they will never call home again

Evacuees still stuck in cramped emergency housing three years on from nuclear disaster
Wildlife Photographer of the Year: Intimate image of resting lions claims top prize

Wildlife Photographer of the Year

Intimate image of resting lions claims top prize
Online petitions: Sign here to change the world

Want to change the world? Just sign here

The proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?