New data from the ONS shows the south East and London with double digit rise in house prices compared to the north widening the gap.

The Office of National Statistics (ONS) has released data showing house prices in the South East are higher by 11.7% followed by London with 10.8% and the East of England up 9.8% over the last year to January.

This compares to Wales with a decrease of 0.3%, Scotland with a rise of only 0.1%, Northern Ireland higher by 0.8% and the North east up 0.9%.

England as a whole was higher by 8.6% with average house prices now at £306,000.

The strong results increases pressure on first time buyers as they now require a larger deposit or have higher earnings to buy their first home.

South East with strong increase

House prices in the South East of England are strong with the average at £374,000 although this is behind London at £550,000. Across the UK the average price of a property is now £292,000 up 0.9% from December to January.

This compares to prices in the north that are rising at a slower rate such as Wales with an average price of £174,000, North east at £156,000 and Northern Ireland at £153,000.

Across the country the ONS figures of house prices and annual changes for January 2016 are as follows:

Area	Annual Changes	House Prices
London	10.8%	£551,000
South East	11.7%	£374,000
East	9.8%	£315,000
England	8.6%	£306,000
UK	7.9%	£292,000
South West	5.1%	£262,000
West Midlands	4.1%	£206,000
East Midlands	5.8%	£199,000
Scoltand	0.1%	£195,000
North West	5.0%	£182,000
Yorks and the Humber	3.8%	£181,000
Wales	-0.3%	£174,000
Northern Ireland	0.9%	£156,000
North East	0.8%	£153,000

For first time buyers properties have increased by 7.7% over the year and the average price paid is now £222,000. The price of a property for an owner occupier has increased by 8.0% over the year and the average price for a house is now £340,000.

For these home movers the gap between their current home and the next has been increasing which means they would need a larger mortgage which may not be affordable.

However, for remortgage buyers the higher prices do give them an opportunity to release capital which they can use to improve their home.

Record rise in regional price index

According to the ONS three of the nine English regions reached record house price index levels during the month of January.

London is 2.5% higher than the previous record in November 2015 and 53.4% higher than the pre-economic downturn peak in January 2008.

The house price index for the South East is also 2.5% higher than the record attained in December 2015 and this region is 26.8% higher than the 2008 peak.

The east of England is 0.2% than the last record also in December 2015 and is now 24.2% higher than the peak before the financial crisis.

Much higher house prices allows older equity release mortgage buyers to access cash in their property to repay an interest only mortgage, improve your quality of life or gift to a family member.

The other six regions all fell back on previous record levels and the North East is the only region in England yet to surpass the pre-economic downturn peak, now just 3.3% behind.

What are your next steps?

Talk to our London City Mortgage advisers if you are an older homeowner releasing equity from your property, we can recommend the lifetime mortgage to access wealth for home or garden improvements and holidays.

Start with a free mortgage quote or call us and we can take your details. Learn more by using the equity release calculator, property value tracker chart and mortgage monthly costs calculator.

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