UK House Prices, interest from overseas buyers Growing

The Government released its latest figures on UK house prices yesterday, and it was far from containing any surprises.

According to the index, which is compiled by the Department for Communities and Local Government based on mortgage approvals, UK house prices were an average 0.5% higher in August than July. However last August prices were still over 5% higher.
The tri-monthly measure, widely regarded as the less volatile and therefore more accurate recorded a rise of 2.7%, compared to a fall of 1.7% in the three months ending May.

However the tri-monthly measure also recorded growth in the three months ending June and the three months ending July, of 2.6% and 2.1% respectively. For the sake of completeness the monthly rises for June and July were 1.6% and 1.4% respectively.

According to the dealing manager of Moneycorp's private division David Kerns, "housing data is currently showing that UK housing is certainly past its worst," after 5 months of growth, he told Write About Property in an interview. This is just one of the factors that will eventually get behind a recovery in Sterling's value.

As it is at the moment, Sterling's weakness could be a factor in the current house prices rises, because it makes British property very appealing to overseas investors.

Overseas buyers have been very active in the UK market over the past few months, because adding the price drops to the falling price of Sterling has made prime properties up to 50% cheaper than at peak. However, because foreign buyers are tending to buy in cash, then they are not influencing the indices of Halifax,Nationwide or DCLG, all of which are based on mortgage data.