Home Asking Price Index, December 2007: iR cut buoys sellers' confidence
Asking prices in England and Wales rose 1.1% in December 2007, lifting the annual increase to 5.8% as sellers gained confidence after the interest rate cut.
This is the December 2007 edition of the Home Asking Price Index, released on 12 December 2007, under the headline:
IR Cut Buoys Sellers' Confidence
The headlines and summary below are the report's own words, with the key figures as it published them, followed by the report's charts and regional tables as printed.
Headlines
- Prices of homes on the market in England and Wales have leapt this month by 1.1%.
- The Asking Price year-on-year change for homes in England and Wales currently stands at 5.8%.
- Greater London Asking Prices rose again this month by +0.8%.
- Prices rose in 6 of the 10 regions in England and Wales.
- Most sellers prefer to 'wait and see' rather than cut their asking prices.
Summary
December's cut in interest rates by the Bank of England has served to increase home sellers' confidence. A majority of sellers have opted not to cut their asking prices in the belief that the IR cut is just the first of several and that the market will soon recover from the current downturn. This wave of renewed confidence in the market, coupled with a continued surge in 3+ bedroom properties delayed by HIPs legislation, has resulted in a rise of 1.1% for the mix-adjusted average house price in England and Wales. However, sellers' confidence in the market may be misplaced, since mortgage lenders, still in the midst of the credit crunch, have given no indication that they will relax their lending criteria over the coming months.
The HAPI for England and Wales has risen 0.9 index points to 106.5 in Q4 [May04 = 100].
Over the last 12 months, Asking Prices for homes in England and Wales have risen 5.8%, ca. 3.7% above the CPI, ca. 1.6% above the RPI and ca. 1.7% above the AEI (excluding bonuses). The mix-adjusted average price of homes in England and Wales, advertised on the open market, now stands at £259,721.
Key figures
| Measure | Figure |
|---|---|
| Mix-adjusted average asking price | £259,721 |
| Monthly change in asking prices | +1.1% |
| Annual (year-on-year) change | 5.8% |
| HAPI index (Q4) | 106.5 |
| England & Wales Q4 change | +0.9% |
Figures are for England and Wales unless the report states otherwise, as published in the edition.
Charts from the report
Laspeyres Index based on Weighted Arithmetic Mean of Weighted Arithmetic Mean of Regional House Prices. [May04 = 100]
Laspeyres Index based on Weighted Arithmetic Mean of Regional House Prices [May04 = 100]
Laspeyres Indices based on Weighted Arithmetic Mean of Regional House Prices [May04 = 100]
Source: HM Land Registry
Regional tables
Regional Housing Markets
| Current average price | Q4 change | |
|---|---|---|
| East Anglia | £271,455 | +4.3% |
| West Midlands | £210,960 | +2.1% |
| Scotland | £181,597 | +1.7% |
| East Midlands | £194,902 | +1.5% |
| Greater London | £351,642 | +1.5% |
| Yorkshire and Humber | £180,891 | +0.6% |
| North West | £192,735 | +0.6% |
| Wales | £197,861 | -0.3% |
| South West | £272,209 | -0.4% |
| South East | £294,172 | -0.9% |
| North | £167,940 | -1.9% |
| England & Wales | £259,721 | +0.9% |
Regional average asking prices for Dec 07 showing gains and losses in Q4 2007.
Read the full December 2007 edition (PDF, 8 pages)
About the Home Asking Price Index
The Home Asking Price Index measures the change in the prices sellers ask for residential property across England, Wales and Scotland. Today it is computed every month from around half a million advertised homes and is mix-adjusted, so a change in what happens to be on the market does not move the figure; earlier editions state the sample they were built from. Because an asking price is set months before a sale completes, the index runs around five months ahead of completed-sale measures such as the UK House Price Index.
Every edition in the archive, back to October 2006, is listed on the index page. How we measure the UK property market explains the listing data behind it, and today's figures by area are on house prices and rental prices.
Text and figures above are quoted from the December 2007 edition as published, with punctuation normalised for the web, and are not revised. Later editions may restate them.
More in What is happening to house prices: the Home guide
Thinking about your next move?
See what your home's worth in seconds, with the UK's longest-running property data behind it.
Get an instant valuation