House prices in England and Wales increased by 0.2% in January, the first monthly rise following several months of declines, taking the average to £301,477, the latest index shows.
But on an annual basis prices have fallen in several locations, most notably London, the South East and the North East, according to the data from the Your Move index.
However, the index report points that overall despite average prices in England and Wales being lower than they were in January 2017 and down annually for the first time since March 2012, average prices continue to remain above the £300,000 mark as they did throughout 2017.
It explains that the move into negative territory in annual price growth reflects the continuing struggles of the capital, where prices have been falling for some time. This trend can now be seen in two other regions, the South East and the North East, with average annual prices down 0.2% and 0.7%, respectively.
Nevertheless, it is London, with a 4.3% annual fall that weighs most heavily on the figures. Excluding London and the South East, but including the North East, prices are up 2.3% over the year. The gap between the annual rate when including and excluding London and the South East, at 2.7%, is now the widest since November 2014.
The South West, up 3.9% and the North West, 3.8%, lead the table for growth, with other areas up between 2.3% and 2.6%, apart from Yorkshire and the Humber where prices are up a more modest 1.4% annually.
The index also shows that the annual price fall in London is the biggest seen since August 2009. Prices in the capital are now, on average, £589,553 to £26,742 lower than in January 2017.
The falls are still concentrated in the most expensive boroughs. The top 11 boroughs out of 33 by price are down an average 7% annually. Kensington and Chelsea remains the most expensive borough, with an average price of £1,805,275, down 12.9%, or more than £200,000, on a year before.
Camden with a fall of 10.8%, the City of London down 18.2% and Wandsworth down 12.7%, have also seen double digit drops. Only Haringey, up 3.2%, and Merton up 13% in the top 11 have seen rises, but at £636,266 and £619,790, respectively, both have prices only a little above the capital’s average.
The dip is less acute at the lower end of the housing market. The 11 cheapest boroughs have seen a modest fall of 1.3% over the year overall, but six are recording house price inflation, led by Bexley with a rise of 5.5%, which, at £363,746, has the second lowest average house prices in London after Barking and Dagenham, where prices are down 1.4% to £294,659.
Nevertheless, sales at the end of last year indicate momentum might be returning to the top of the market. Hammersmith and Fulham up 19%, Camden up 14% and Haringey up 13%, recording the biggest increase in transactions in the fourth quarter of 2017.
‘The slowdown in London can now also be seen in the South East and North East. Time will tell if the rest of England and Wales remains resilient, but the increase in January will be seen by many as positive news and an indication of continued demand,’ said Oliver Blake, managing director of Your Move and Reeds Rains estate agents.
‘And, with the focus on supporting those entering the property market, including the abolishment of stamp duty for first time buyers, we may see more movement in the market which should bring benefits for all,’ he added.