House prices rise 9.4%

The average house price in London has risen 9.4 per cent to £241,818 over the past year, Whitehall figures show today.

In the UK as a whole, prices increased 14.6 per cent, according to the first such government survey.

The report, based on houses bought with a mortgage in July, found the average price was £166,669 in England, £93,778 in Scotland, £103,669 in Wales and £100,246 in Northern Ireland. The lowest average regional price was £96,620 in the North-East where, even so, prices had risen 24.4 per cent.

For first-time buyers, the average price was 11.3 per cent higher than in July last year, while people moving up the property ladder had to find an extra 16.4 per cent.

The figures, based on about 25,000 house-sale completions from 50 mortgage lenders, is more comprehensive and accurate than figures from individual lenders such as Nationwide and Halifax and will now be published every month. But Melfyn Williams, president of the National Association of Estate Agents, is sceptical about the survey.

"The housing market moves quickly, yet this index relies on completed sales which can be several months old," he said. "It is worrying if the Government is to use this data to help set interest rates."

According to today's Rightmove website, the average asking price for London homes this month is £251,472, down from £253,360 in September last year. Asking prices peaked in February at £265,899.

A Rightmove spokesman said: "If the falls of the past couple of months continue, we could be looking at average asking prices for a London home back below the quarter of a million mark next month."