House prices hit by cold spots

The West Midlands is one of six regions where house prices are increasing by less than the current three per cent rate of inflation over the past year.

While prices are still growing strongly in the South – and storming ahead by 14.2 per cent in London – in the West Midlands they are up 2.3 per cent, and in the North and East Midlands they are up just 0.9 per cent.

The findings have been made in the latest survey by property website Hometrack. Nationwide average house prices have risen by 6.8 per cent over the past year.

Today experts warned that the impending packs (HIPs) were causing extra volatility in the market, with thousands more homes going up for sale at the same time as the number of buyers has fallen for the past four months in a row.

The result is that house prices are slowing rapidly in the Midlands and the North. Harvey Williams, West Midlands spokesman for the Royal Institution of Chartered Surveyors, said: "Research for just the past 10 days has shown the number of properties coming on to the market is escalating at an enormous rate of knots.

"The number of houses on the market is up by 15 per cent on the same time last year, and we are not even into May yet."

Huge numbers of home sellers are trying to get their houses on the market before the June 1 deadline to try and avoid costs of £500 or more for the compulsory packs, which provide potential buyers with up-front details and an energy performance certificate.

They are aimed at bringing efficiency to the home-buying process and cutting the number of transactions which collapse late in the day.

But critics say they will bring little benefit to the consumer, while at the same time adding to the cost and red tape of buying a home.

Mr Williams said: "At the same time as we are expecting a fourth interest rate hike from the Bank of England, HIPs are exaggerating the number of properties coming on the market."