14/12/2004

According to the government's figures house price inflation rate fell from 13.8% in September to 12.6% in October. Although prices between September and October rose by 0.7%, annual inflation fell because prices rose by 1.8% over the same period last year.

The figures, which are produced by the Office of the Deputy Prime Minister in conjunction with the Office of National Statistics, are based upon 'completions' data from about 50 mortgage lenders and so appear later than other indices.

The rise in UK prices between September and October can be attributed to rises in prices for detached houses by 1.0%, semi-detached houses by 0.6% and terraced houses by 0.9%.

Of the home countries, only Northern Ireland saw a rise in annual inflation rate. However, this was slight, from 13.3% in September to 13.4% in October. Inflation in England fell from 12.9% in September to 11.9% in October. Annual inflation in Wales fell from 25.5% in September to 23.2% in October. Scotland saw inflation fall from 21.9% to 17.8% over the same period.

While annual house price inflation for the whole of England fell in October, it rose in the West Midlands and London. All other regions saw fall in house price inflation. The highest rates remain in the North East (23.0%), the North West (20.3%) and Yorkshire and the Humber (19.6%). Inflation rates in these regions remain substantially higher than in the rest of England, although rates in the East Midlands and the West Midlands also remain high at above 15%.

Inflation in London rose from 6.6% in September to 7.0% in October - due to a marginally higher rise in prices between September and October this year compared with last year.

House prices: regional

Mix-adjusted average house prices in October were £192,874 in England, £138,250 in Wales, £116,478 in Scotland and £115,596 in Northern Ireland.

The English region with the highest average house price in October was London at £265,324. The lowest average price was in the North East at £126,732.

Only the East, London, South East and the South West had average prices above the UK average.

House price inflation: type of buyer

The UK house price inflation rate for first time buyers fell from 15.6% in September to 12.5% in October. This was due to a rise of less than 0.1% in prices between September and October, compared with a rise of 2.8% seen over the same period last year.

The inflation rate for former owner-occupiers fell from 13.1% in September to 12.7% in October. This was due to a rise of 1.0% in prices between September and October, compared with a rise of 1.3% over the same period last year.

The average price paid by first time buyers across the whole of the UK was £143,847 in October, while the average price paid by former owner-occupiers was £200,275.