Some areas of the UK have seen “noticeable increases” in the purchase prices paid by those taking their first steps onto the property ladder, new data from the Mortgage Advice Bureau has found.
Some areas of the UK have seen “noticeable increases” in the purchase prices paid by those taking their first steps onto the property ladder, new data from the Mortgage Advice Bureau has found.
The firm reported that the average first-time buyer price in the north west rocketed by 11.25% in December compared to the previous month, while the west Midlands (3.58%) and east of England (2.02%) saw significant monthly increases.
The brokerage suggested this may be down to the changes to stamp duty announced in the Budget in November. First-time buyers no longer pay stamp duty on any purchase of up to £300,000, nor on the first £300,000 of any purchase worth up to £500,000.
Critics have warned that this change is likely to push prices up, negating any potential tax saving for first-time buyers.
However, Mortgage Advice Bureau argued that “whether this reaction is just temporary or the start of a longer-term trend remains to be seen”.
Over the UK as a whole, the average purchase price remained virtually unchanged at £248,637, only marginally higher than the £248,202 paid in November.
Despite this, there were significant differences between regions. For example, while the south west and Scotland saw significant price rises of 6.9% and 5.9% respectively, other areas did not fare so well. The east of England saw prices drop by 7.7%, while prices in greater London plummeted by more than 15%.
Brian Murphy, head of lending at Mortgage Advice Bureau, noted that the property market had withstood huge amounts of political and economic uncertainty over the last year, and yet had delivered house price growth largely in line with forecasts.
He concluded: “Bearing in mind that we’ve seen far fewer discretionary buyers and sellers in the last twelve months – which arguably has been one of the key factors leading to the low levels of stock in many areas – as well as a discernible decrease in the amount of landlords adding to their portfolios, one might suggest that the level of growth and transaction volumes for 2017 as a whole represents a stable market underpinned by ongoing consumer demand as we start the new year.”
