THE HOUSE price boom is accelerating rapidly, official figures showed yesterday, as influential economist Kate Barker and the Home Builders' Federation warned 1m more homes are needed to stop a housing crisis.
Prices in London shot up 13.2 per cent in the 12 months to January, even faster than the 12.3 per cent rise through 2013. Across the UK as a whole prices increased by 6.8 per cent, up from 5.5 per cent previously, the Office for National Statistics said.
Prices are now above their pre-crash peak in London, the South East and the East of England. An average home in London cost £458,000 in the month, compared to the UK average of £254,000.
A decade ago Barker said 210,000 homes should be built each year to avert a squeeze on housing. But just 115,000 were built annually and the shortage is forcing up prices.
The squeeze is not expected to slow any time soon. Mortgage lending in February was 50 per cent higher than in the same month of 2013, according to the British Bankers’ Association.
The month saw 39,838 loans for home purchases and 20,772 remortgages.