UK House Price Index: March 2015

• UK house prices increased by 9.6% in the year to March 2015, up from 7.4% in the year to February 2015

• House price annual inflation was 9.4% in England, 5.7% in Wales, 14.6% in Scotland and 7.5% in Northern Ireland. This is the highest annual increase in Scotland since July 2007

• The pace of annual house price growth increased across the majority of the UK

• Annual house price increases in England were driven by an annual increase in the East (11.4%), London (11.2%) and the South East (11.2%)

• Excluding London and the South East, UK house prices increased by 8.1% in the 12 months to March 2015

• On a seasonally adjusted basis, average house prices increased by 1.1% between February and March 2015

• In March 2015, prices paid by first-time buyers were 7.8% higher on average than in March 2014. For owner-occupiers (existing owners), prices increased by 10.3% for the same period

The Office for National Statistics (ONS) House Price Index (HPI), previously published by the Department for Communities and Local Government (DCLG), is a monthly release that publishes figures for mix-adjusted average house prices and house price indices for the UK, its component countries and regions.

The index is calculated using mortgage financed transactions that are collected via the regulated mortgage survey by the Council of Mortgage Lenders. These cover the majority of mortgage lenders in the UK. The HPI complements other measures of inflation published by us such as the consumer price indices, the producer price indices and the services producer price indices.

This statistical bulletin provides comprehensive information on the change in house prices on a monthly and annual basis. It also includes analysis by country, region, type of buyer (first-time buyers and former owner-occupiers) and type of dwelling (new dwelling or pre-owned dwelling). Historical series for all accompanying tables that transferred from DCLG are also available in the data section of this release.

The figures published in this release are not seasonally adjusted unless otherwise stated.

UK average house prices increased by 9.6% over the year to March 2015, up from an increase of 7.4% in the year to February 2015 (Figure 1). This is the first increase in the pace of annual UK house price inflation since September 2014. The average UK mix-adjusted house price in March 2015 was £273,000.

In March 2015, the UK mix-adjusted house price index increased to a record level of 209.7 (Figure 2). This is 1.0% higher than the record level witnessed in August 2014, when the index reached 207.7 and 13.0% higher than the pre-economic downturn peak of 185.5 in January 2008.

On a seasonally adjusted basis, average house prices increased by 1.1% between February and March 2015, compared to a fall of 0.8% in average prices during the same period a year earlier.

During the year to March 2015, average house prices increased 9.4% in England (up from 7.7 in the year to February 2015), 5.7% in Wales (up from 1.4%), 14.6% in Scotland (up from 5.3%) and 7.5% in Northern Ireland (down from 14.7%).

This is the highest annual increase in Scotland house prices since July 2007 (Figure 3). The number of mortgages for house sales in Scotland increased by approximately 50% between February and March 2015. A significant proportion of this increase in sales was for houses costing more than £500,000. These factors, along with a relatively small annual increase in Scotland prices of 0.8% in March 2014, have led to the price index for Scotland increasing by 14.6% when compared to a year earlier. It should also be noted that the land and buildings transaction tax replaced UK stamp duty land tax in Scotland from 1 April 2015, which may have had an impact on the increase in prices.

In March 2015, the England and Scotland house price indices increased to record levels (Figure 4).

The index for England reached 207.0 in March 2015. This is 0.8% above the the previous record level witnessed in August 2014 (205.3) and 14.5% higher than the pre-economic downturn peak in January 2008 of 180.8. The index for Scotland (243.2) in March 2015 is 3.5% above the previous record level witnessed in August 2014 (234.9). Scotland prices are now 5.5% above the pre-economic downturn peak of June 2008 (230.6). The index for Wales (223.1) in March 2015 is 0.7% below the record level of 224.6 in January 2015. However, house prices in Wales are 0.5% higher than the pre-economic downturn peak of January 2008 (222.1). The index for Northern Ireland (152.7) in March 2015 is 45.8% below the peak of August 2007 (281.5).

The pace of annual house price growth picked up across the majority of the 9 English regions (Figure 5). The largest annual increase was in the East at 11.4% (up from 11.2% in the year to February 2015) followed by London (11.2% increase in the year to March 2015, up from 9.1%) and the South East (11.2% increase in the year to March 2015, up from 8.5%). The lowest growth in March 2015 was in Yorkshire and The Humber; here prices increased by 4.4% over the year. Excluding London and the South East, UK house prices increased by 8.1% over the year to March 2015, up from 6.1% in the year to February 2015.

This month, a number of English regions have seen house prices increase to record levels (Figure 6).

The price index for the East of England reached a record level of 193.3 in March 2015. This is up 0.7% from the previous record in February 2015 (192.0) and 14.8% higher than the pre-economic downturn peak in January 2008 (168.4). The price index for the East Midlands reached a joint record level of 198.1 in March 2015 (along with August 2014). The price index for the East Midlands is 2.4% higher than the pre-economic downturn peak in January 2008 (193.5). The price index for the West Midlands reached a record level of 191.3 in March 2015. This is up 0.8% from the previous record in December 2014 (189.7) and 3.2% higher than the pre-economic downturn peak in October 2007 (185.4). The price index for the South East reached a record level of 191.3 in March 2015. This is up 1.1% from the previous record in December 2014 (189.2) and 14.9% higher than the pre-economic downturn peak in January 2008 (166.5). The price index for the South West reached a record level of 188.4 in March 2015. This is up 0.1% from the previous record in January 2015 (188.2) and 4.3% higher than the pre-economic downturn peak in October 2007 (180.7).

The price index for London is now 0.6% below the record level of 243.5 in August 2014 with an index of 242.1 in March 2015. However, the London index is 38.7% higher than the pre-economic downturn peak in January 2008 (174.5).

Average mix-adjusted house prices in March 2015 stood at £284,000 in England, £173,000 in Wales, £145,000 in Northern Ireland and £207,000 in Scotland (Figure 7).

In March 2015, London continued to be the English region with the highest average house price at £498,000 and the North East had the lowest average house price at £157,000. London, the South East and the East all had prices higher than the UK average price of £273,000.

Excluding London and the South East, the average UK mix-adjusted house price was £211,000.

The average price for properties bought by first-time buyers increased by 7.8% over the year to March 2015, up from an increase of 6.8% in February 2015 (Figure 8). In March 2015, the average price paid for a house by a first-time buyer was £206,000.

The average price for properties bought by former owner-occupiers (existing owners) increased by 10.3% in the year to March 2015, up from an increase of 7.7% in February 2015. In March 2015, the average price paid for a house by a former owner-occupier was £319,000.

During the year to March 2015, prices paid for new dwellings increased by 13.6% on average, compared with an increase of 2.8% in the year to February 2015 (Figure 9). The average UK house price for new dwellings in March 2015 was £274,000.

During the year to March 2015, prices paid for pre-owned dwellings increased by 9.2% on average, compared with an increase of 7.7% in the year to February 2015. The average UK house price for pre-owned dwellings in March 2015 was £273,000.

The HPI monthly and quarterly reference table (3.59 Mb Excel sheet) provides full historical series for the monthly tables accompanying the house price index statistical bulletin. This month, tables 1 to 9 have been updated with the latest monthly estimates for March 2015. The seasonally adjusted figures in Table 7 have been revised this month as scheduled. This month, tables 10 to 19 have been updated with the latest data for the first quarter of 2015.

The HPI annual reference table (1.18 Mb Excel sheet) contains all the annual live tables. No annual tables have been updated this month. The next set of updates to annual tables will be in July 2015.

The HPI weights summary (79.5 Kb Excel sheet) reference table provides a summary of the aggregated mix-adjustment weights used in the production of the HPI for the period 2011 to 2015. The mix-adjustment weights are updated in the February HPI each year.

We published annual house price statistics for small areas alongside the December 2014 HPI, covering the period 1995 to 2013. This dataset will be updated to include 2014 data alongside the April 2015 HPI, to be published on Tuesday 16 June 2015.

For further information, please contact hpi@ons.gov.uk

We would welcome your views on the data presented in this statistical bulletin. Please contact the house price index team using the email address below to discuss any aspect of the data, including your views on how we can improve the data.

hpi@ons.gov.uk