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| Property price rises stoke fears of a new housing bubble | Property price rises stoke fears of a new housing bubble |
| (3 days later) | |
| Fears that George Osborne, the chancellor, is stoking a new housing bubble through plans to boost mortgages may be exacerbated by figures showing house prices grew faster in May than at any time in the past six years. | Fears that George Osborne, the chancellor, is stoking a new housing bubble through plans to boost mortgages may be exacerbated by figures showing house prices grew faster in May than at any time in the past six years. |
| Prices rose 0.4%, the most since May 2007, driven mainly by the market in London and the south-east – although the rest of the UK also averaged a marginal rise. | Prices rose 0.4%, the most since May 2007, driven mainly by the market in London and the south-east – although the rest of the UK also averaged a marginal rise. |
| Data from Hometrack, a property analytics firm, shows prices grew by 0.9% in the capital last month, and by 0.5% across the south-east. | Data from Hometrack, a property analytics firm, shows prices grew by 0.9% in the capital last month, and by 0.5% across the south-east. |
| The number of people looking to buy grew almost 15% in London over the past six months but the number of available properties declined, creating the biggest gap between supply and demand for more than four years. | The number of people looking to buy grew almost 15% in London over the past six months but the number of available properties declined, creating the biggest gap between supply and demand for more than four years. |
| The average time a sale takes in London is now one month – a third of the time taken in the East Midlands. | The average time a sale takes in London is now one month – a third of the time taken in the East Midlands. |
| Outside London and the south-east, the picture was more mixed. Prices were static in four regions (the north-east; north-west; Wales; and Yorkshire and Humberside) and grew in a further four (East Anglia; East Midlands; West Midlands; and the south-west). | Outside London and the south-east, the picture was more mixed. Prices were static in four regions (the north-east; north-west; Wales; and Yorkshire and Humberside) and grew in a further four (East Anglia; East Midlands; West Midlands; and the south-west). |
| Richard Donnell, Hometrack's director of research, said: "While levels of demand have been increasing each month, the total growth in buyer numbers has been broadly in line with that seen in recent years. But it is a lack of housing to buy that is driving the acceleration in prices. | Richard Donnell, Hometrack's director of research, said: "While levels of demand have been increasing each month, the total growth in buyer numbers has been broadly in line with that seen in recent years. But it is a lack of housing to buy that is driving the acceleration in prices. |
| "High moving costs, uncertainly over the outlook for jobs and a lack of available housing to move to means homeowners remain unwilling to put properties on the market. This is only serving to limit supply further." | "High moving costs, uncertainly over the outlook for jobs and a lack of available housing to move to means homeowners remain unwilling to put properties on the market. This is only serving to limit supply further." |
| Donnell said he expected to see more "mini housing cycles" with more sellers entering the market but demanding unrealistically high prices. Currently, though, sales are going through at 93.9% of asking price – the highest since summer 2010. | Donnell said he expected to see more "mini housing cycles" with more sellers entering the market but demanding unrealistically high prices. Currently, though, sales are going through at 93.9% of asking price – the highest since summer 2010. |
| Last week the average price of a home in London passed £500,000 for the first time, according to the property website Rightmove. | Last week the average price of a home in London passed £500,000 for the first time, according to the property website Rightmove. |
| In his March budget, Osborne unveiled a Help to Buy scheme giving partial guarantees for billions of pounds worth of low-deposit mortgages, allowing more people to get loans without a big deposit, as well as providing government loans. But observers including the Royal Institute of Surveyors and the outgoing Bank of England governor, Sir Mervyn King, say the plans risk fuelling a new bubble and warping the market at the expense of new buyers. | In his March budget, Osborne unveiled a Help to Buy scheme giving partial guarantees for billions of pounds worth of low-deposit mortgages, allowing more people to get loans without a big deposit, as well as providing government loans. But observers including the Royal Institute of Surveyors and the outgoing Bank of England governor, Sir Mervyn King, say the plans risk fuelling a new bubble and warping the market at the expense of new buyers. |