Average house price is now over £230,000

42% more first time buyers than a year ago

Alex Johnson
Friday 12 July 2013 14:07 BST
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House prices have risen by an average of £5,664 over the last year and now stand at £232,801, according to new figures from LSL Property Services.

"House prices have never been higher. They reached a record high in May and set another record in June," said David Newnes, director of LSL Property Services which owns Your Move and Reeds Rains estate agents. "The catalyst has been a significant improvement in mortgage availability which is thawing the frozen first-time buyer market. The plethora of attractive mortgage deals on offer is working wonders and wider pools of buyers are flocking to the market.

"Although house prices may have risen significantly in June 2013, the reality is that the annual growth is being driven by London. Figures are slightly misleading, reflecting the influx of foreign buyers who are boosting property price growth in the capital. Money is pouring into prime areas from cash buyers and international investors looking to store their wealth in bricks and mortar."

A separate report from the Council of Mortgage Lenders suggests that there were 42 per cent more first-time buyers in May than a year ago.

The number of mortgages to first-time buyers in May was 25,100, 29 per cent higher than in April, and 42 per cent higher than in May last year. First-time buyers accounted for 45 per cent of all loans for house purchases.

Paul Smee, director general of the Council of Mortgage Lenders, said: "Both the borrowing appetite of first-time buyers and the availability of attractive mortgages for them have improved markedly since a year ago.

"What is interesting is that, in contrast to some recent assertions, this is happening in parallel with the strengthening buy-to-let market. It is perfectly possible for both the buy-to-let market and the first-time buyer market to improve at the same time, as the evidence clearly demonstrates."

George Spencer, chief executive officer of property and technology company Rentify, said: "Significant growth in the buy-to-let market is occurring alongside the recovery in the residential mortgage market, not at the expense of it. The growing trend for people to live on their own means landlords are spotting opportunities and expanding their portfolios while first-time buyers are also managing to get on the housing ladder if they have the necessary deposit and income to do so. However, buying doesn't suit everyone, the flexibility of renting is more important to some.'

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