House prices rise in October

Property prices rose in October, decreasing affordability for first-time buyers even further.

According to the Rightmove House Price Index, there was a 2.7 per cent increase month-on-month, taking the average property value to £241,642.

Rightmove says that the introduction of Home information packs (Hips) has had a big impact, with sellers rushing to offload their property before they were required to pay for a pack.

According to the firm, there was a substantial increase in the number of three-bedroom properties on the market as these houses required a Hip from September 10th.

This led to an increase in average house prices as there are more larger, high-value properties up for sale.

"Legislative tinkering involving future cut off dates has a history of unbalancing markets. In a stable market this presents fewer dangers, but in today's more sensitive financial environment the effects can be more exaggerated," said Miles Shipside from Rightmove.

"It is very unfortunate timing that Hips and their side-effects are straddling a period of record house prices, the highest interest rates for six years and a tightening in mortgage lending criteria," he added.

FTBs were given a boost this month when the Bank of England chose to maintain the base rate of interest for the third consecutive month.

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