Housing Market: Key Economic Indicators

Published Monday, February 1, 2016

Housing market: Data on house prices, mortgage approvals and house-building.

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On a seasonally adjusted basis, house prices on the ONS index increased by 0.8% between October 2015 and November 2015. Prices were 7.7% higher in November 2015 compared with a year ago.

Mortgage approvals increased by 0.6% in December 2015 and were 17.5% higher compared with a year ago. Approvals remain well down on pre-recession levels, but have been rising during 2015.

Housing starts increased by 2% in Q3 2015, compared to Q2 2015. Housing starts and completions have increased from the lows observed in late 2008 and early 2009 but remain below pre-recession levels.

ONS House Price Index

On a seasonally adjusted basis, average mix-adjusted house prices in the UK increased by 0.8% between October 2015 and November 2015.

The ONS index is mix-adjusted to allow for differences between houses sold (e.g. type, rooms, location) in different months.

There are regional differences in house prices. The average mix-adjusted house price is highest in London at roughly £537,000. The lowest prices, are found in Northern Ireland and the North East at £158,000 and £157,000 respectively.

Mortgage approvals, UK

Bank of England data on the number of mortgages approved to finance house purchases are a leading indicator of house sales.

There were 70,837 mortgage approvals in December 2015, up 0.6% on the previous month and 17.5% on December 2014.

Housing starts and completions - England

There were 34,250 house building starts in England in Q3 2015, up 2% on Q2 2015 and up 2% on Q3 2014. This is above the recent low of 17,150 in Q1 2009, but still below the 48,970 starts in Q1 2007.

There were 34,940 dwelling completions in Q3 2015, down 2% from Q2 2015 but 15% higher than in Q3 2014. Completions remain below the peak of 48,440 completions in Q1 2007.

Commons Briefing papers SN02820

Author: Matthew Keep

Topics: Economic situation, Housing

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