House prices continued to rise in February, driven by a strong recovery in both Greater London and the South East according to the latest e.surv Acadata report.

Its latest house price index shows there was a 1.5% increase in February, meaning house prices rose by 6.9% year-on-year. According to its data the average house was worth £261,767. 

Regional data shows the strongest growth last month in Greater London and the South East. E.surv says this is the first time that these have appeared in the top four areas for house price growth since August 2020. 

Other regional data showed that Wales continued to perform strongly, with prices up by 9%, year on year. However London was catching up with a 8% annual increase in prices. This is a significantly higher figure than the 5.9% annual increase in property prices shown in the previous months report.

These three regions, along with the West Midlands all showed stronger average price gains than the average for England and Wales.

The slowest growth remained in the North East, with prices up by just 1.2% year on year. The East Midlands saw a 2.8% growth in property prices, whilth e North West recorded 3.3% growth according to this e.surv data. 

In total e.surv said that four areas have seen an increase in their annual rate of growth (averaged over a three-month period) while six saw a fall. 

The four areas with an increase in rates are Yorkshire and the Humber (up to 5.3%), the South West (up to 7.2%) , Greater London (up to 8%)  and the South East (up to 11.%). 

E.surv director Richard Sexton says: “The South East is now in top position in the league table having bee absent for more than a decade.” He points out that there remain a huge lack of supply in the market, but demand remains high for properties that offer more space and a garden but also access to places of work.

Sexton says: “ Our data is showing evidence now that while some areas, like Wales, continue to offer excellent value and rural living, we are seeing a demand for properties that offer a good working from home environment but remain in reach of our cities.

“Some commentators have pointed out that offices are well-liked working environments, and it is long journeys that deter people from commuting. 

“It stands to reason then that the ‘perfect commute’ will command a good price and hybrid working arrangements will clearly benefit commuter belt towns. 

“In our granular analysis of the South East, we see that Sevenoaks in Kent has a similar journey time to Woking of 35 minutes into London. The average house price in Sevenoaks is £605,000, which is similar to that of Woking at £603,000 and Epsom and Ewell, which again has a similar journey time and an average price of £595,489. This suggests that there is a close correlation between rail commuting times into Central London and house prices. If hybrid working is the future of office working then easy commuting will be an essential pre-requisite of many homebuyers.”

Acadata senior analysts John Tindale and Peter Williams point out that Wales currently has the second-highest price growth in this svuey and has been one of the top three places for the past eight month. They point out that this country ticks “all the right boxes” in terms of scenic countryside and attractive coastal location, and remains relatively affordable with the third lowest average house price of these areas. Average house prices are only lower in the North East and Scotland.

Looking at the housing market as a whole, e.surv says the continued strength of demand for residential property as expressed in accelerating prices is perhaps surprising gien the wider backdrop of rising interest rates and inflation, along with global uncertainty. 

However it points out with with limited number of homes coming onto the market there has been inevitable pressure on prices with buyers competing to acquire the desired property. Though interst rates have increased they remain low in historical terms. 

E.surv also points to recent data from Zoopla that noted buyer demand was up 70% on their five yeas average while stock for sale was 43% lower.