The Office for national Statistics (ONS) latest statistics shows that house prices are rising faster than inflation.

Figures published by the ONS show house prices for the year to June are rising at 3.1% ahead of price inflation in the economy and are therefore rising in real terms.

The Royal Institution of Chartered Surveyors (RICS) have said that house prices are rising at the fastest rate since November 2006.

London driving prices higher

Property prices in London are driving the average house price higher. In London the yearly rise in homes is at 8.1% compared to England as a whole of 3.3% , Wales at 4.3%, the South east at 2.9% and the West Midlands at 3.1%.

Rising house prices in London allows the equity release mortgage buyer to access money and use this to consolidate debt, home and garden improvements or reduce inheritance tax owed by your beneficiaries.

Excluding London the UK house price rise is only 1% for the year to June.

Property prices are still falling in other parts of the country. In Scotland prices were lower by 0.9% and in Northern Ireland by 0.4%.

Equity release has allowed older home movers to buy more expensive properties where there is a shortfall in equity with the balance as a lifetime mortgage.

Increasing number of buyers

According to the Council of Mortgage Lenders (CML) the number of first time buyers has reached the highest level since 2007. In the second quarter 68,200 people became homeowners for the first time.

RICS has also recorded an increase in demand with more people registering with estate agents in Wales, Scotland and West Midlands experiencing the largest increase in sales.

The availability of cheaper mortgage loans has helped boost demand with the government Funding for Lending and Help to Buy Schemes.

Help to Buy allows buyers of new-built homes to put down only a 5% deposit for a mortgage with the government lending capital of 15% of the property value.

Funding for Lending has also significantly increased the availability of lending reducing the mortgage rates and increasing the demand from first time buyers and remortgage buyers.

What are your next steps?

Talk to our London City Mortgage advisers if you are an older homeowner releasing equity from your property, we can recommend the lifetime mortgage to access wealth to repay an interest only mortgage, for holidays of a lifetime or gifting to a family member.

Learn more by using the equity release calculator, property value tracker chart and mortgage cost calculator. Start with a free mortgage quote or call us and we can take your details.

At LCM our mortgage brokers can provide advice if you are a first time buyer, moving home, want to remortgage your existing home to a new cost effective mortgage deal or are a buy-to-let investor.

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