Data from the Office of National Statistics show house prices are rising fastest in the East and South-East of England rather than London.

The Office of National Statistics (ONS) has published data showing average house prices rising 2% in July from £177,000 to £282,000 and is now 16.7% higher than the peak reached in 2007 before the financial crisis.

Over the year UK house prices have increased 5.2% to the end of July. The highest rise is the East of England rising at 8.3% with the average property now worth £302,000.

For first time buyers the cost of a new home is higher by 5.5% over the year to July and means they must find a larger deposit and have higher earnings to purchase their first home, with the average cost now at £215,000.

Second is Northern Ireland with a price rise of 7.4% and average prices of £154,000 although since significant falls during the financial crisis, this remains 42% below the peak of August 2007.

Large north-south price divide

The house price difference between the north and south of England is increasing as the North East have experienced a fall of -0.7% with the average home now worth £156,000 as the following table from the ONS shows:

Area	Change	Value
East	8.3%	£302,000
Northern Ireland	7.4%	£154,000
South East	6.7%	£354,000
England	5.6%	£295,000
London	5.5%	£525,000
UK	5.2%	£525,000
East Midlands	5.0%	£197,000
West Midlands	4.9%	£208,000
Yorks and Humber	4.7%	£183,000
South West	4.2%	£354,000
North West	3.7%	£182,000
Wales	0.3%	£173,000
North East	-0.7%	£156,000
Scotland	-1.3%	£196,000

In Scotland house prices reduced by the largest amount of -1.3% with average price of a home is £196,000 and Wales up only slightly at 0.3% and average prices of £173,000.

Existing homeowners have see prices higher by 5.5% for the year to July with average property prices for owner-occupiers now at £329,000.

London prices remain significantly higher with an average price of £525,000 although annual growth is not the highest at 5.5% to July and analysts believe double-digit rises have ended for now.

Lack of supply pushing up prices

According to Campbell Robb Shelter’s chief executive, by not addressing the dramatic shortage of homes in the UK house prices are pushed higher and higher.

This puts home ownership further out of reach for millions of young people and families that remain trapped living with their parents or in private renting.

Older remortgage buyers may reduce the supply of family homes on the market and avoid downsizing with the equity release mortgage buyer to access money from their home for holidays, home improvements or gift to a family member.

Private renters are also affected by the rise in house prices as new buy-to-let landlords would be expected by lenders to have higher rental incomes to cover the higher interest payments.

For home movers there is a rising gap between their current home and their next home which means they need an ever larger mortgage to move.

These increases do create an opportunity for remortgage buyers as higher prices allow them to release capital which they can use to improve their home.

What are your next steps?

Talk to our London City Mortgage brokers for advice if you remortgage your existing home and want the best mortgage deal or release capital, buying your first home, moving home or are a buy-to-let investor.

For older homeowners releasing equity from your property, our LCM mortgage advisers can recommend the lifetime mortgage, accessing wealth to improve your quality of life or even help your children start or expand a business.

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

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