House prices rises in the West Midlands have trailed behind the rest of the country during February according to data published today .
Overall, prices in England and Wales have increased by 0.4 per cent so far this month following a surge in the number of people looking to move, the latest survey by property website Hometrack shows.
It was the third month running that prices have increased, and the jump was the biggest seen since June 2004, the company said.
But the greater West Midlands has seen an increase of just 0.1 per cent while in the core area of Birmingham and the Black Country prices actually fell by 0.1 per cent.
That is in contrast with London where prices have risen by 0.9 per cent.
Hometrack's report does not give reasons for the figures but points to what it calls "important regional differentials" in its data.
The overall rise has been caused by a combination of more buyers entering the market and a shortage of properties for sale.
It said the number of potential buyers registering with agents has risen by 26 per cent during February, while the strong end to 2005 has left estate agents facing a shortage of properties to sell.
It said as a result of the supply of homes for sale failing to keep up with demand, prices were being pushed upwards and now averaged £161,700.
The trend was most obvious in southern parts of the country, where the greatest imbalance between supply and demand currently exists. Hometrack said the 0.9 per cent rise in London comes on the back of a 35 per cent increase in new buyers, but only a 10 per cent jump in properties on the market.
A similar trend in the South East and East Anglia has pushed prices up by 0.3 per cent and 0.5 per cent respectively.
At the same time the average time taken to sell a property in these regions has been falling, and in London the average home now takes less than five weeks to sell for the first time since July 2004.
By contrast house price growth outside of the south remains subdued, as the imbalance between supply and demand is less stark and house prices in many areas are still adjusting after the strong growth seen between 2000 and 2004.
Richard Donnell, director of research at Hometrack, said: "Prices are likely to continue to rise over the next month or so as a result of buyers returning to the market and supply remaining limited.
"Most of this growth is likely to be concentrated in southern parts of the country."
But he said whether the momentum of early 2006 could be maintained depended on the outlook for interest rates, the strength of the economy and consumer confidence.
"A period of improved market activity was always inevitable after the lengthy slowdown between mid-2004 and mid-2005 but the reality is that housing remains fully valued across much of the country," he added. "We expect values to keep rising, but the scale of growth over the later parts of the year is set to be far more modest than what we are currently seeing." ..SUPL: