House prices in every region of England rose in September, according to official data published on Monday which reignited the debate about the prospects of a new house price bubble.
The Land Registry data showed that even before the government accelerated the second phase of its Help to Buy mortgage guarantee scheme, prices had increased 3.4% in a year on average, and were higher than in September 2012 in all English regions. However, prices in Wales were down by 1.7% year on year and fell by 0.4% in September.
Howard Archer, chief UK economist at IHS Global Insight, said: "There is a mounting danger that house prices could really take off over the coming months, especially if already significantly improving housing market activity and rising buyer interest is lifted appreciably further by the Help to Buy mortgage guarantee scheme, which will take full effect in January."
Overall house prices in England and Wales continued to rise in September, increasing by 1.5% over the month to an average of £167,063, according to the Land Registry. This remained below the peak reached in November 2007, when average prices hit £181,839. There was also a jump in the number of homes sold for more than £1m.
The data, which does not include newbuild homes or those which have not changed hands since 1995 – but unlike other indices does include cash sales – covers the period before the launch of the second part of the government's controversial Help to Buy scheme earlier this month. The scheme gives a taxpayer-backed guarantee to lenders offering 95% mortgages that are open to first-time buyers and home movers on newbuild homes worth up to £600,000. Critics have argued it will further fuel an already rising market.
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