East Midlands is only region to experience house price rise in May

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by Kay Murchie

According to Chesterton estate agents, property prices fell in 11 of the 12 UK regions during May with the exception being the East Midlands, where house prices rose during the month by 0.1%.

Average prices across England and Wales declined by 0.7% in May while year-on-year, house price growth fell further to 1.3%, according to the organisation’s poll of polls.

As a result, the average price of a residential property is currently £193,183.

The research for Chesterton was carried out by the Centre for Economics and Business Research (CEBR). Commenting on the figures, Douglas McWilliams, the organisation’s chief executive, said lending remains restricted and is causing the housing market to weaken considerably. Eleven out twelve UK regions showed month on month house price falls in May.

However, fundamental supply issues will prevent the UK housing market from experiencing decline as dramatic as that seen in the US and Spain, added Mr McWilliams.

The CEBR reports that annual growth in house prices is higher in London than in all other regions over the year to May. However, there is proof of considerable cooling here.

However, some London boroughs are experiencing price growth with Islington recording the fastest annual house price growth where prices rose by 21% over the year.

For the top 20% of properties by value, there were 4 other local authorities which recorded annual price growth above 10%: Kensington and Chelsea, the City of Westminster, Camden and Southwark.

Robert Bartlett, chief executive of Chesterton, said buyers are still out there and with softening prices they are keen to buy, but due to credit restrictions, some are finding it difficult to progress purchases.

Prices remain firm in several London boroughs but what is more noticeable is the fall in the number of sales transactions, concluded Mr Bartlett.