UK house prices increased by 6.1% in the year to September 2015, up from 5.5% in the year to August 2015
House price annual inflation was 6.4% in England, 1.1% in Wales, 1.1% in Scotland and 10.2% in Northern Ireland
Annual house price increases in England were driven by an annual increase in the East (8.4%) and the South East (7.4%)
Excluding London and the South East, UK house prices increased by 5.0% in the 12 months to September 2015
On a seasonally adjusted basis, average house prices increased by 0.8% between August and September 2015
In September 2015, prices paid by first-time buyers were 4.3% higher on average than in September 2014
For owner-occupiers (existing owners), prices increased 6.9% for the same period
The Office for National Statistics (ONS) House Price Index (HPI), previously published by the Department for Communities and Local Government (DCLG), is a monthly release that publishes figures for mix-adjusted average house prices and house price indices for the UK, its component countries and regions.
The index is calculated using mortgage financed transactions that are collected via the regulated mortgage survey by the Council of Mortgage Lenders. These cover the majority of mortgage lenders in the UK. The HPI complements other measures of inflation published by us such as the consumer price indices, the producer price indices and the services producer price indices.
This statistical bulletin provides comprehensive information on the change in house prices on a monthly and annual basis. It also includes analysis by country, region, type of buyer (first-time buyers and former owner-occupiers) and type of dwelling (new dwelling or pre-owned dwelling). Historical series for all accompanying tables that transferred from DCLG are also available in the data section of this release.
The figures published in this release are not seasonally adjusted unless otherwise stated.Back to table of contents
UK average house prices increased by 6.1% over the year to September 2015, up from 5.5% in the year to August 2015 (Figure 1). The average UK mix-adjusted house price in September 2015 was £286,000.
In September 2015, the UK mix-adjusted house price index increased 0.3% from the previous record level witnessed in August 2015 to reach a new record of 219.8 (Figure 2). The UK index is 18.5% higher than the pre-economic downturn peak of 185.5 in January 2008.
On a seasonally adjusted basis, average house prices increased by 0.8% between August and September 2015, compared with an increase of 0.4% in average prices during the same period a year earlier.
Table A: House price index - summary of UK all dwellings, September 2015
|Index - February 2002=100|
|Index (NSA)||% 12 month change (NSA)||Index (SA)||% monthly change (SA)||£ (NSA)|
|Source: Office for National Statistics|
|1. Average house prices are not comparable between years as they reflect a different mix of houses being transacted. Indices have been chain linked so they are comparable year-on-year. For more information please see the re-weighting section in the background notes|
|2. SA = Seasonally adjusted|
|3. NSA = Not seasonally adjusted|
|4. R = Data revised|
Download this table.xls
During the year to September 2015, average house prices increased 6.4% in England (up from 6.0% in the year to August 2015), 1.1% in Wales (up from 0.9%), 1.1% in Scotland (up from -0.6%) and 10.2% in Northern Ireland (up from 5.2%).
The main movements for each country are:
the index for England reached a new record of 218.1 in September 2015 (Figure 4) – this is 0.2% above the previous record level witnessed in August 2015 (217.6) and 20.6% higher than the pre-economic downturn peak in January 2008 of 180.8
the index for Wales in September 2015 (224.5) is slightly below the record level of 224.6 in January 2015 – house prices in Wales are 1.1% higher than the pre-economic downturn peak of January 2008 (222.1)
the index for Scotland in September 2015 (233.9) is 3.8% below the record level witnessed in March 2015 (243.2) – Scotland prices are now 1.4% above the pre-economic downturn peak of June 2008 (230.6)
the index for Northern Ireland in September 2015 (170.2) is 39.5% below the peak of August 2007 (281.5)
The pace of annual house price growth was again varied across the 9 English regions in September 2015 (Figure 5). The largest annual increase was in the East at 8.4% (down from 8.8% in the year to August 2015) followed by the South East (7.4% increase in the year to September 2015, unchanged from August). The North East had the lowest annual growth of the 9 regions, with prices increasing 1.8% in the year to September 2015 (down from 3.2%).
London prices increased by 7.2% over the year to September 2015 (up from 5.4% in the year to August 2015).
Excluding London and the South East, UK house prices increased by 5.0% over the year to September 2015, up from 4.8% in the year to August 2015.
This month, average house prices in 4 of the 9 English regions are at record levels (Figure 6). House prices in the North West, Yorkshire and The Humber, the East Midlands and the South East fell back slightly from the record levels witnessed in August 2015. The North East is the only English region yet to surpass its pre-economic downturn peak (prices in the North East remain 2.4% below the peak of January 2008).
The main regional price index movements for September 2015 are:
the price index for the West Midlands reached a joint record level of 196.4 in September 2015 (also this level in July 2015) – this is 1.0% higher than August 2015 and 5.9% higher than the pre-economic downturn peak of October 2007 (185.4)
the price index for the East reached a record level of 204.9 in September 2015 – this is up 0.9% from the previous record in August 2015 (203.0) and 21.7% higher than the pre-economic downturn peak in January 2008 (168.4)
the price index for London is now 0.5% above the record level of 256.6 in August 2015 with an index of 257.9 in September 2015 – the London index is 47.8% higher than the pre-economic downturn peak in January 2008 (174.5)
the price index for the South West reached a record level of 198.2 in September 2015 – this is up 0.1% from the previous record in August 2015 (198.1) and 9.7% higher than the pre-economic downturn peak in October 2007 (180.7)
Average mix-adjusted house prices in September 2015 stood at £299,000 in England, £175,000 in Wales, £199,000 in Scotland and £162,000 in Northern Ireland (Figure 7).
In September 2015, London continued to be the English region with the highest average house price at £531,000 and the North East had the lowest average house price at £158,000. London, the South East and the East all had prices higher than the UK average price of £286,000.
Excluding London and the South East, the average UK mix-adjusted house price was £218,000.Back to table of contents
The average price for properties bought by first-time buyers increased by 4.3% over the year to September 2015, down from an increase of 4.5% in August 2015 (Figure 8). In September 2015, the average price paid for a house by a first-time buyer was £216,000.
The average price for properties bought by former owner-occupiers (existing owners) increased by 6.9% in the year to September 2015, up from an increase of 6.0% in August 2015. In September 2015, the average price paid for a house by a former owner-occupier was £335,000.Back to table of contents
During the year to September 2015, prices paid for new dwellings increased by 6.3% on average, compared with an increase of 9.7% in the year to August 2015 (Figure 9). The average UK house price for new dwellings in September 2015 was £272,000.
During the year to September 2015, prices paid for pre-owned dwellings increased by 6.1% on average, compared with an increase of 5.2% in the year to August 2015. The average UK house price for pre-owned dwellings in September 2015 was £287,000.Back to table of contents
The last progress update regarding the development of a single, official house price index was published in July 2015.
Since the last update, there have been delays in securing access to the data required to begin test production of the new index, however, work is still progressing. Property attributes data from the Valuation Office Agency (the council tax valuation list) has been secured, along with historic data from the Land Registry. Analysis has been taking place to match these 2 sources of data and to provisionally begin refining the methodology for the new house price index (279.7 Kb Pdf). Corresponding data for Scotland is expected to be available shortly, which will enable the new methodology to be finalised and subsequently allow the test production of the new index to commence. Additional work is also taking place to quality assure these input datasets, and to finalise the data sharing agreements necessary to ensure the ongoing supply and use of the data.
The immediate focus of the development work will now be to finalise and test the new methodology followed by the publication of an article detailing the proposed new methodology for users. It is expected that the article will be published in late November 2015.
The development Working Group has also been considering the transition to the new house price index for users. Further details regarding the transition plan will be published in early 2016, and will likely include a number of user events to fully explain the changes ahead of the anticipated first publication of the new index by June 2016.
For further details, please contact firstname.lastname@example.orgBack to table of contents
The UK House Price Index grew at an annual rate of 6.1% in the year to September, a 0.6 percentage point increase from August and the strongest rate of growth since March 2015. This pick-up in the annual rate came despite a slow-down in the monthly growth rate, which fell to 0.8% on a seasonally adjusted basis. The increase in the annual rate of price growth was partly driven by London, where prices grew by 7.2%, 1.8 percentage points above the growth in the year to August. An ongoing shortage of supply coupled with strengthening demand may be behind this increase in the growth rate.
A number of indicators suggest that the supply of housing remains weak across the UK, with the lack of homes available for sale increasing competition and supporting prices. The ONS Output in the Construction Industry release for September reported a 3.9% fall in new housing construction in the year to September. In the secondary market, the Bank of England’s Agents’ Summary of Business Conditions for Q3 reported that weak activity could be self-perpetuating as potential vendors remain reluctant to put their homes on the market without suitable properties available for purchase. The Royal Institute of Chartered Surveyors’ Residential Market Survey for September supported this view, suggesting the biggest factor in the record low stock of homes available for sale is deterring would-be sellers from putting their homes on the market.
While the supply of housing remains tight, demand continues to grow. The Bank of England’s November Inflation Report stated that housing demand remains strong, which should be reflected in an increase in mortgage approvals. Indeed, the volume of mortgage approvals grew by 3.9% in Q3 2015 to reach its highest level since the first quarter of 2014. Mirroring this increase in demand, UK home sales continued to pick-up despite the shortage of supply, and in the three months to September (Jul-Sep) were 4.4% higher than in the preceding three months (Apr-Jun).
Broader economic indicators suggest that the economy has continued to grow relatively strongly over recent periods, with output now increasing at a rate similar to its pre-downturn trend. Labour market conditions have continued to strengthen, as unemployment fell to 5.3% for July to September 2015 and annual regular pay grew by 2.5%. These improvements, along with a resurgence in job-to-job moves and broader evidence of tightening, suggest that confidence in labour market outcomes remains high. However, despite the strengthening in nominal pay growth over the past year and low inflation, house price growth continues to outpace real earnings growth.Back to table of contents
The HPI monthly and quarterly reference table (3.67 Mb Excel sheet) provides full historical series for the monthly tables accompanying the house price index statistical bulletin. This month, Tables 1 to 9 have been updated with the latest monthly estimates for September 2015. The seasonally adjusted figures in Table 7 have been revised this month as scheduled. This month, Tables 10 to 19 have been updated with the latest data for the third quarter of 2015.
The HPI annual reference table (1.19 Mb Excel sheet) contains all the annual live tables. No annual tables have been updated this month. The next set of updates to annual tables will be in March 2016.
The HPI weights summary reference table (83.5 Kb Excel sheet) provides a summary of the aggregated mix-adjustment weights used in the production of the HPI for the period 2007 to 2015. The mix-adjustment weights are updated in the February HPI each year.Back to table of contents
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