North-South divide in house prices, says Nationwide
- 27 September 2013
- From the section Business
The gap between house prices in northern and southern England has moved above £100,000 for the first time, according to the Nationwide.
The building society said that house price growth was accelerating, with an average annual increase of 5% in the UK in September.
This was driven by price rises in cities such as Manchester and Belfast.
London prices were at an all-time high, but overall UK prices were 8% below the peak of 2007, the survey said.
The Nationwide said that property prices had risen by 0.9% in September compared with the previous month. This valued the average home in the UK at £172,127.
House prices, and activity in the housing market, has been gathering pace. The Nationwide said prices were growing at the fastest rate since July 2010.
Government schemes aimed at kick-starting the market doldrums of 2011 and 2012 have been among the reasons for the pick-up.
So, Chancellor George Osborne has now asked the Bank of England to take a bigger role in ensuring his Help to Buy housing scheme does not fuel a property boom.
Yet, the picture is not identical across the country.
The typical property in London and the surrounding area, the South East of England, the South West of England and East Anglia combined, is more than £100,000, or 74%, higher than a home in the North of England, the North West, Yorkshire and Humberside, and East and West Midlands combined.
This could create issues for people deciding whether to relocate for work.
Prices in Scotland, Wales and the North of England are far from levels seen during the housing boom, with prices still 12% to 14% lower than the previous peaks, according to the Nationwide's data, which is based on its mortgage business.
Price rises are driven by southern regions of England. Yet all regions recorded house price growth in the third quarter of the year - the first time this has happened in nearly six years. Northern Ireland, for example, recorded its first increase in prices since 2007.
"There are signs that the pick-up is becoming increasingly broad-based," said Robert Gardner, Nationwide's chief economist.
However, data from the Land Registry, published on the same day, suggested that some areas of England and Wales were still recording house price falls.
It said that the North East and North West of England, as well as Yorkshire and the Humber, and Wales all recorded house price falls in August compared with the same month a year earlier.
It said the fall was biggest in the North East, which saw a 2.2% drop.