Property 'cold spots' hotting up
HOUSE prices have risen by up to a quarter in a year in areas previously considered property 'cold spots'.
Average prices in the North climbed 24.36% to reach just under £100,000. Increases of more than 20% were also registered in Wales and the East Midlands.
The Land Registry figures clearly show, however, that on a national basis price rises are showing signs of slowing.
The annual rate was 13% between April-June and almost 20% at the beginning of the year.
However, this slowdown has not been fast enough for the Bank of England, which last week pushed up the base interest rate from 3.5% to 3.75%.
The bank hopes the move will cause a gradual property market slowdown, rather than a crash which would be disastrous for the economy.
In London the price of the average home has broken the quarter-of-a-million mark - hitting a new peak of just over £262,000.
Prices in the capital are 5% higher than they were a year ago. Following falls earlier in 2003, they are also 6% higher than they were in the summer and appear to be continuing to rise in most locations.
The number of London homes sold for more than £1m has also bounced back. Between July and September 2003, 522 properties were sold for more than six figures, compared to 338 sold between April and June. However, the figure was still well below the record 705 million-plus homes sold between April and June of 2002.
In the London commuter belt, prices rose by up to 13.6%, with the most expensive areas seeing the biggest increases.
The fastest price rises were in London's cheapest boroughs, mostly on the eastern side. Prices in Newham, London's 'buy-to-let' hotspot, are 19% higher than last year.
The next best performers are Havering and Lewisham, both up 17% on a year ago and 6% up on this summer's prices.
Prices in Barking & Dagenham, which is still London's cheapest borough, rose by 16% to an average £144,832.
In London's most expensive borough, Kensington & Chelsea, prices rose by just 5%. But the average price in the Royal Borough - £687,364 - is still almost five times higher than in Barking & Dagenham.
The biggest price reduction since a year ago was in Haringey, where house values fell by 5%. In Camden they are 3% lower and in Merton they are down 2%.
Average prices in Ealing, Lambeth, Hammersmith & Fulham, Richmond and Tower Hamlets are virtually unchanged since late 2002.
The average house price in Surrey and Buckinghamshire is £287,461, still higher than the London average of £269,022. The smallest increase, 3.9%, was in West Berkshire.
Independent housing economist John Wriglesworth said: 'These figures confirm our forecast that the end of the year would be considerably more positive than the beginning.
'It is too early to assess the impact of interest rate rises, but with excess demand already occurring in several boroughs, further house price rises are almost certain.'
Milan Khatri, chief economist at the Royal Institution of Chartered Surveyors, said: 'Signs of renewed strength in the London housing market accord with the recovery in the stock market since its lows in the spring, and an improvement in employment prospects.'
