The latest House Price Index (HPI) by Rightmove provides further evidence of the improvement in the UK property market.
Rightmove’s HPI for August reveals that house prices have gone up by 5.5 per cent in the last year despite a 1.9 per cent fall in the average asking price of a property from July’s £253,658 to £249,199.
The fall is expected as prices normally drop over the summer and the decline is less than normal for August.
Miles Shipside, Rightmove director and housing market analyst said: “A holiday season price dip is the norm in August, with an average drop in the last five years of over 2 per cent.
“Even with this month’s below par 1.8 per cent fall, the national average asking price is still up by more than £20,000 so far in 2013.”
The report warned that the potential benefits of the government’s Help to Buy scheme need to be communicated effectively to both buyers and sellers to ensure that rising demand is met by increased supply.
Rightmove said that interest rates and government schemes are helping to boost demand but to ensure there is not a “return to excessive house price inflation” the rise needs to be balanced by an increase in supply.
Mr Shipside said: “It is now critical that the supply of property improves so that the goal of a significant increase in transaction numbers is not over-shadowed by an unsustainable boom in property prices.
“Developers’ reaction to the new-build Help to Buy scheme must start to address the structural shortfall of the last two decades and increase the number of houses being built.
“A second key success measure will be an increase in the supply of property to market from those who have put their housing needs on hold since 2007.”
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