Welsh housing prices are on the rise, propelled by gains in a pricier corridor near Cardiff, according to a housing index out Tuesday.
The average price of a home in Wales grew 2.9% in the first quarter compared to last year, with some of the biggest appreciation in the southeast along the Bristol Channel, according to the index by mortgage lender Principality Building Society.
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Monmouthshire, the most expensive county in Wales, has seen prices increase 8.6% over the past year to £279,434 (US$399,405). The county on the border of southeast Wales and England saw prices rise 2% from the end of 2017, according to the report.
Vale of Glamorgan, the second priciest county in Wales, saw prices rise 6.5% over the past year to £252,411 (US$360,780). Prices in the county, often ranked one of the wealthiest in Wales, increased 3.2% over the end of 2017.
In the capital of Cardiff, prices grew 4.8% year over year.
Outside of the wealthier southeastern part of Wales, prices also jumped in Isle of Anglesey, which saw a 4.8% increase in the average home price to £203,713 (US$291,174).
High-end buyers had a hand in boosting prices in the first quarter as they rushed to finish deals ahead of a new Land Transaction Tax that went into effect April 1, according to the report. Wales recorded the highest number of sales in January in five years, though overall transactions in the first quarter fell 4% due to a drop-off in activity in February and March.
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The new Land Transfer Tax imposes as much as a 12% tax on the price of homes over $1.5 million. It also imposes an additional 3% tax on second homes.
While prices are rising in pricier quarters, first-time buyers and remortgaging is driving the bulk of housing activity in Wales, said Tom Denman, chief financial officer at Principality Building Society, in the report.
"As expected, the Welsh housing market continues to grow at a modest, steady rate, as homeowners continue to take advantage of historically low borrowing rates," Mr. Denman said.