House prices rose by 0.8 per cent during the past month as the mini-boom continued in southern regions, figures showed today.
Southern house prices have risen 9.4 per cent over the past year compared with 2.7 per cent in the North. The gap between the two halves of the UK is widening for the first time in four years, Rightmove, a property website said.
Although the figures provide ammunition for the "hawks" on the Bank of England's interest rate committee, Rightmove warned an interest rate rise would hit northern regions hardest.
While prices in London surged 2.1 per cent this month to a record average of £315,224, the average price in the North-east and Cumbria slumped 1.8 per cent. Prices in that region have stagnated over the past year.
It added that as the southern market was less dependent on people buying using a mortgage based on their income, it was less affected by traditional affordability constraints.
Miles Shipside, commercial director of Rightmove said, "Parts of the north are now being left behind, as stretched affordability has limited sellers' ability to increase prices in most regions.
"Demand and transaction levels are still healthy in the north despite the slowdown in prices. Any upward movement in interest rates could put this in jeopardy at a time of year when the market normally slows down," Shipside added.
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South sets pace in house price rises
Mon, 19 Jun 2006
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