The January data from Land Registry's flagship House Price Index shows an annual price decrease of 1.0 per cent which takes the average property value in England and Wales to £161,545. The monthly change from December to January is 1.1 per cent.
The region in England and Wales which experienced the highest increase in its average property value over the last 12 months is London with a movement of 2.9 per cent.
London also experienced the greatest monthly rise with a movement of 2.5 per cent. The North East experienced the greatest annual price fall with a decrease of 4.5 per cent. The North West saw the most significant monthly price fall with a decrease of 2.1 per cent.
The most up-to-date figures available show that, during November 2011, the number of completed house sales in England and Wales increased by 3 per cent to 57,967 compared to 56,312 in November 2010. The number of properties sold in England and Wales for over £1 million in November 2011 decreased by 4 per cent to 524 from 548 in November 2010.
Paul Hunt, managing director of Phoebus Software said:
“Rising house prices show the importance of mortgage lending in supporting the property market. As lenders have taken advantage of the low Base Rate to offer finance which is more affordable than ever, buyers have taken the opportunity to lock themselves into the market at favourable rates.
"This has pushed up lending volumes, which have risen in seven of the last eight months and property prices have risen accordingly. Of course, some of the demand currently boosting the market is part of a rush to beat the Stamp Duty holiday, but the improving availability and affordability of mortgage finance is the only way to sustain the housing market in the long term”.
Tracy Kellett, managing director of UK buying agent, BDI Home Finders, said:
"The January Land Registry data is yet more proof of how house prices are continuing to defy logic. In an economic climate that could have been dreamt up by Hieronymus Bosch, prices are rising.
"Long-term, house price rises like this are not sustainable. They are being propped up by an extreme lack of stock and historically low interest rates. What's happening is that only the best properties, the ones that attract real buyer competition, are selling right now. This is naturally skewing the figures.
"One problem is that sellers see price rises like this and mark up their own properties accordingly, which accentuates the paralysis in the market as a whole. The latest Rightmove index, showing that new sellers upped their asking prices by over 4% in February, is the latest example of seller misconception.
"The January house price rise is not good news for the market, it's quite the opposite. The higher the market rises in the current climate, the harder it will fall."
Russell Quirk, director of the low fee estate agents emoov.co.uk commented:
"There has been a modest but discernible spring bounce in many parts of the UK housing market. The impending end of the stamp duty holiday has certainly been a factor, but its impact will of course only be temporary.
"But also we are seeing a steady but seismic shift in the sort of people who are buying property. For four years, most of those moving were people who had to do so. Many "discretionary" movers were put off by fears of a second property crash.
"While these Land Registry figures show that prices are still down on where they were a year ago, January's price rises hint at a steady return of confidence. The coiled spring of anticipation is slowly beginning to unwind as more would-be buyers see buoyancy return to the market."
