"All ten of the regions in our survey have experienced rising prices over the last twelve months, with nine of the ten setting new record average house prices in May 2022."
This sets yet another new record level for England and Wales, and for the eighth time in the last nine months, with annual price growth now at 10.9%. From the start of the pandemic in March 2020, to the end of May 2022, house prices have increased by £53,430, or 16.9%, which contrasts with the increase in CPIH of 10.2% over the same period.
The average house price in England and Wales has continued to rise throughout the first six months of 2022 on a near straight-line basis, confounding all the predictions of a slowing growth rate.
All ten GOR areas have experienced rising prices over the last twelve months, with nine of the ten setting new record average house prices in May 2022. The one exception is the North East, where prices in Tyne and Wear and County Durham - the two largest conurbations in the region in terms of house sales - fell by -0.9% and -2.7% respectively in the month.
Wales remains the GOR area with the highest annual growth rate, a position it has now held for eleven months, and with real terms increases in prices. Twenty-one of the twenty-two local authority areas in Wales have seen prices rise over the period, the one exception being Denbighshire. Five local authority areas in Wales (two fewer than last month) have annual house price growth in excess of 15%, the highest being the Isle of Anglesey, where average prices have increased by 22.8%, with detached homes in the area rising from £304k in May 2021, to £358k one year later.
In second place is Greater London, where prices over the twelve months have risen by 10.2%. Price growth in London has been the lowest of all the 10 GOR areas since the start of the pandemic, as purchasers looked to move out of the capital into the more open countryside of the South East and beyond. However, from March 2022 onward, we began to see that some buyers were moving back into central London to take advantage of the lull in prices, as offices in the capital started to re-open. Additionally, the quarantine rules that had been in place for visitors to the UK were removed, allowing overseas buyers to travel to the United Kingdom with more confidence. This resulted in an increased level of purchases, with areas such as Kensington and Chelsea and the City of Westminster proving to be much-favoured locations. These two boroughs have recently returned to substantial annual growth rates, reaching 18.2% and 23.7% respectively
Four of the ten GOR areas have seen an increase in their annual rates of growth, compared to the previous month. The GOR area with the largest increase in its growth rate is Greater London, up from 8.5% last month, to 10.2% this month. The two areas with the largest falls are the North East and the North West, both witnessing a decline of 2.0% from the rates experienced last month.
There are five distinct groupings in England and Wales in terms of house price growth, with the hottest markets in Wales and the South of England, and then an evident cooling as you move further north. Wales is out on its own at 12.4%, 2.2% ahead of all nine English regions. The next grouping is in the south of England, with the South West, the South East and Greater London having rates between 9.9% and 10.2%. There follows a grouping of the East and West Midlands and the East of England with rates between 6.7% and 8.9%, with the fourth group of Yorkshire and the Humber, along with the North West at 4.8% and 5.2% respectively. Finally we have the North East at 2.4%, being half the rate of Yorkshire and the Humber.
Richard Sexton, director at e.surv, commented: “All ten of the regions in our survey have experienced rising prices over the last twelve months, with nine of the ten setting new record average house prices in May 2022. Wales remains the strongest performing region - with the highest annual growth rate, a position it has now held for eleven months, and with real terms increases in prices. The return to work has seen a change in the fortunes of the South East, with Greater London now taking second place as prices over the twelve months have risen by 10.2%.
“What is clear in our data is that house price growth remains resilient notwithstanding the pressures in the broader economy. This is possibly because the squeeze on the cost-of-living is not yet being absorbed equally across society. Home owners, for now, are relatively unscathed. Indeed, arrears figures remain at historic lows. Housing, as an asset group, continues to outperform other classes and so remains attractive to investors – particularly good quality properties. As ever a lack of supply of desirable stock and strong employment in the UK economy continues to support price growth.”
