UK Latest: Moderate Growth In House Prices

March 5, 2019


The latest data from Zoopla shows the annual rate of price growth for key locations in the UK increased by 2.9% for the past 12 months ending in January 2019. However 13 cities showed lower price growth the past year in a review released yesterday in Propertywire.


The city with the fastest rising prices were in Leicester with an annual growth of 6% with Belfast up 5.8% followed by Manchester up 5.4%, Glasgow and Birmingham up 5.1%,Liverpool up 5%, Nottingham up 4.6% and Sheffield up 4%.


Aberdeen had a decrease in home prices of 1.6% but when compared with to 2017 when prices dropped 6.8% this quite an improvement. The report shows Cambridge and London prices climbing up only 0.2%. Aberdeen and inner London have seen large discounts with asking prices lowered by 7% and a selling period of 16 weeks.


A lack of affordability has heavily slowed the price growth in Bristol, Edinburgh, Bournemouth and Portsmouth. For Bristol the price growth for a home went up 1.8% thus being the lowest rate in close to five years. Nottingham had the average discount on prices at 2% with eight weeks needed to make a sale but home price growth is reported at 4.6%.


The report states:


'Our analysis reveals that market conditions are strong across twelve cities. All these are located outside the south of England. While increased uncertainty has resulted in a slower rate of house price growth, there remains further potential for price growth.'


When it comes to achieved prices versus asking prices Edinburgh and Glasgow homes are the quickest areas for  property sales with achieved prices at 6% to 8% more than the asking price.


Additional data for home sales sales volumes with first time buyers as the largest group in 2018.


‘Uncertainty has impacted the headline rate of growth, but demand for housing is holding up better than many had expected.'


‘We expect city level house price growth to moderate further in the very near term. Underlying market conditions remain strong across many cities and there is potential for further price inflation once the outlook becomes clearer.'


Simon Heawood, chief executive of Bricklane:


‘Regional cities such as Leeds, Leicester, Manchester, Birmingham remain strong investment options. However, the realities of investing in property far from home mean that investment in these cities will be out of reach for many.'


‘The top line price growth figure in London is low, but is made up of many smaller housing markets, with performance much stronger in Outer London than Inner London. In a buyer’s market, there are opportunities for professional investors to take advantage of discounts, even in a lower momentum market.'


As for locations that are more affordable for those wanting to get on the housing ladder Marc von Grundherr, director of agents Benham and Reeves says:


‘In these slower market conditions, it’s only natural that the more desirable UK cities will see prices growth flatten and the time to sell extend, due to the already inflated price of getting a foot on the ladder there.'


‘The commitment of investing in the inner London market at present is likely to take a bit more thought than it may have previously, but to label London as a drag and to liken the market strength to that of Aberdeen is a tad misleading.'


‘Prices are holding firm, transactions are steady and London remains the pinnacle of the UK housing market, having emerged from the negative price trends of the previous year.'

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