A selection of images representing communities.
|Published||12 November 2007|
Download this release as a PDF: House Price Index - September 2007 (PDF, 108kb, 9 pages)
Figure 1: UK annual house price inflation (all dwellings)
|All dwellings||All dwellings||All dwellings|
Not seasonally adjusted
Feb 02 = 100
over 12 months
Feb 02 = 100
over 12 months
The UK house price inflation rate fell from 11.3 per cent in August 2007 to 10.8 per cent in September 2007. Between August and September there was a rise of 0.3 per cent in the prices index of properties bought compared with a bigger rise of 0.8 per cent over the same period last year resulting in a decrease in the inflation rate.
Figure 2: House price inflation by country 12-month percentage change
The rise in UK prices between August and September can be attributed to increases in average prices for flats (1.2 per cent), semi-detached houses and bungalows, (0.3 per cent) and detached houses (0.1 per cent). It is partly offset by a fall in the price of terraced houses (0.2 per cent).
All four countries of the UK, England, Scotland, Wales and Northern Ireland, saw decreases in house price inflation in September 2007. In England annual house price inflation fell from 10.5 per cent in August to 10.1 per cent in September; In Scotland house price inflation fell from 13.1 per cent in August to 12.5 per cent in September; In Wales house price inflation decreased from 7.8 per cent in August to 6.2 per cent in September. In Northern Ireland house price inflation fell from 45.4 per cent in August to 42.7 per cent in September.
House price inflation rose in three of the English regions and fell in six regions.
The highest inflation rate was in London (16.5 percent) followed by South East (11.5 per cent), and the South West (9.2 per cent). Inflation rates were lower in the East (8.3 per cent), North East and the Yorkshire and the Humber (7.5 per cent each). The lowest inflation rates were in the East Midlands (6.8 per cent), the North West (6.2 per cent) and the West Midlands (5.0 per cent).
Figure 3: Regional house price indices 12-month percentage change for the latest month
Mix-adjusted average house prices in September were £227,661 in England, £168,405 in Wales, £163,359 in Scotland and £246,794 in Northern Ireland.
The English region with the highest average house price in September remains London at £342,319. The lowest average price was in the North East at £151,415.
Of the English regions, only the East, London, South East and the South West had average prices above the UK average.
Figure 4: Mix-adjusted average house prices not seasonally adjusted
The UK house price inflation rate for first time buyers fell from 12.0 per cent in August to 11.8 per cent in September. There was a rise of 0.2 per cent in the prices index between August and September in the properties bought by first time buyers compared with a bigger rise of 0.3 per cent over the same period last year.
The inflation rate for former owner occupiers fell from 11.1 per cent in August to 10.5 per cent in September. There was a rise of 0.4 per cent in the prices index between August and September in the properties bought by former owner occupiers, compared with a bigger rise of 0.9 per cent over the same period last year.
The average price paid by first time buyers across the whole of the UK was £167,503 in September, while the average price paid by former owner occupiers was £245,920.
Figure 5: UK annual house price inflation by type of buyer 12-month percentage change
Tables are from March 2005 to September 2007.
Additional tables and earlier monthly data can be accessed in the 'Live tables' section (housing market and house prices) at www.communities.gov.uk/housingstatistics.
1. The mix-adjusted house price series are produced by Communities and Local Government and are being published on an experimental basis. Development of the methodology underpinning the indices has been undertaken in conjunction with the Office for National Statistics. In light of the recent Statistics and Registration Service Act 2007 we will seek advice from the new Statistics Board, at the most appropriate time, to gain accreditation for the index as a 'National Statistic'.
2. Since September 2005 the new mix-adjusted house price index is based on an enlarged sample of completions data (about 50,000 per month) from about 60 mortgage lenders who supply data through the Regulated Mortgage Survey (RMS) of the Council of Mortgage Lenders (CML)/BankSearch. Prior to this date the index was based on the Survey of Mortgage Lenders (SML) (about 25,000 completions per month). The number of cases received will also be affected by the total number of mortgages that have been completed.
3. In January of each year the index weights are revised to reflect the pattern of property transactions during the previous 3 years. The mix-adjusted average prices for the rest of the year are then determined using these new weights. Consequently whilst house prices within the year are comparable - they are all based on the same weights - house prices between years cannot be compared because last year's weights and this year's weights are different. The index itself is constructed on a chain-linked basis, which enables year-on-year comparisons to be made. This means that the year-on-year change in the index for September, say, is effectively the change in the average price from September 2006 to January 2007 (using the weights for 2006) combined with the change in the average price from January 2007 to September 2007 using the weights for 2007. Therefore, the year-on-year change in the index is not the same as the year-on-year change in the mix-adjusted average price.
4. The Communities and Local Government index is currently showing similar year-on-year inflation to other indices available from commercial sources. The slight difference will be affected by differences in weighting. The Communities and Local Government index uses expenditure weights, whereas other indices use transaction weights. Consequently, the Communities and Local Government index is influenced by house price inflation rates in the higher priced areas (which are currently in the South) where house prices - and therefore total expenditure on house buying - is highest. Similarly, regional inflation determined by the Communities and Local Government is more influenced by the market for the higher priced properties (ie the demand for detached houses).
5. Note that the Communities and Local Government house price index figures released in this issue are based on completions during the month of September. Other recent indicators have been based on asking prices in October or prices based on mortgages approved during October. Therefore the Communities and Local Government figures are not directly comparable with these other indicators.
6. A month on month comparison of the Communities and Local Government index and price is not advised, as the series are not seasonally adjusted and comparisons over periods of less than a year will be affected by seasonal fluctuations. The series will not be seasonally adjusted until a sufficiently long monthly series exists.
7. Further details on the methodology of the index can be found in the Publications section of Housing Statistics website, at www.communities.gov.uk/housingstatistics.
8. Further quarterly and annual house price data can be found on the Communities and Local Government web site in Live tables - Housing Market section, tables 507 and 508 and tables 590 to 594.
9. The next three release dates are:
telephone: 0303 444 0000.
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