Larger loans may be needed for house deposits as prices rise

Those seeking to buy a house may need to take out larger loans towards a deposit, as new figures have indicated prices are rising again.

Land Registry data for England and Wales in April showed the typical home became 0.8 per cent more expensive in the month compared with March, the average figure being £163,083.

Of the ten regions, seven saw price increases, with only the east of England, the north-west and the north-east experiencing price falls.

Notably, those in London will have to borrow more as prices soared by three per cent, with the typical home in the capital now priced at £352,187, around 3.5 times as much as a home in the north-east.

Local variations within regions were also noted. For example, the typical Welsh home was priced at £120,452, but while a house in Cardiff cost around £20,000 more than this, up the road in Merthyr Tydfil the average is just £69,173.

And in London itself, the high average price is bolstered by Kensington and Chelsea's typical value of £914,727. However, even the cheapest borough in the capital – Barking and Dagenham – is more expensive at £213,638 than the surrounding south east region.

Overall, only London and the south-east are more expensive than a year ago, with the overall value still 1.3 per cent down on April 2010, but the latest trend may indicate a reversal of this and, as a result, larger deposits.

Research by Halifax published last week indicated coastal towns in England and Wales could be the most prone to higher price rises.

It noted the last decade saw an overall increase of 118 per cent, but this was ten per cent higher in seaside locations.

Posted by Paul Thacker