'Two speed market' sparks record house prices in East of England

Average house prices rose by £120 in September to £292,763. Prime London property saw the biggest slowdown in inflation while cheaper property on the periphery and the leading regions are still seeing strong growth year on year.

Average annual price increases in greater London fell from 4.7% to 2.5% in September, with average prices dropping marginally month-on-month by 0.6%.

Prices for the East of England were up by 7.5% for the year, ahead of the South East at 7.2% and the South West at 4.2%.

Typically for the time of year, transactions fell in September from the previous month to an estimated 74,000 sales. As predicted last month, transactions are at similar levels – or a little above – as they were in 2013, and look likely to rise over the coming couple of months as in that year, according to the Index.

Adrian Gill, director of Your Move and Reeds Rains estate agents, said: “We’re seeing a two speed market become firmly established as cheaper parts of the capital and the regions record big price increases driven by demand for affordable homes, while prime London property stalls.

“At the same time transaction levels are showing how much the market has changed, with the number of properties now held by private landlords changing market dynamics.

“This all creates big challenges for government housing policies, which are going to have to be flexible enough to allow regions to make use of the solutions that work best for their different needs.”