REGIONAL PROPERTY PRICES: Latest market performance in England, Scotland, Wales and N. Ireland
Kate Faulkner's analysis of regional property prices shows that despite different housing policies for each country, prices have grown at similar rates.
Although they do vary dramatically at a local level, the impact on property prices and transactions seems to mainly be economic. So a local area that’s doing well, such as London, Edinburgh, Belfast or Cardiff are typically seeing good growth. That’s because the economy tends to be stronger in ‘capital’ cities, people tend to earn higher wages and, of course, supply is more restricted.
Compare this to less well-off areas such as Aberdeen and Nottingham, then these areas tend to struggle more from a property price performance perspective – both are down year on year and prices in the long term don’t tend to keep up with inflation.
Country performance data from Halifax
“Scotland saw a more modest rise in house prices, where a typical property now costs £205,144, +1.7% more than the year before.”
“House prices in Wales also recorded strong growth, up +5.5%, compared to the previous year, with properties now costing an average of £224,433.”
“Northern Ireland continues to record the strongest property price growth of any nation or region in the UK, rising by +9.8% on an annual basis in August. The average price of a property in Northern Ireland is now £201,043.”
Regional property price tracking
As the market is starting to improve, the number of regions that are seeing prices going up has increased and the number seeing property prices going down has also increased, notably with home.co.uk, Halifax and UK HPI all showing every region up or staying the same.
Of the regions still in negative growth, they are incredibly small, and I expect by the end of the year, these will all be up. While some indices are showing the East Midlands is still down, the amount is almost insignificant as it’s -0.2% or -0.1%.
As a result, the main regions struggling to see growth are the ones that have the toughest affordability: South West and South East, as well as the East, although London seems to be bucking the trend with small growth year on year. This is likely to be due to the severe lack of stock and wealth in the region.
Commentary on the regional performance by indices
Zoopla – Overall price trend is upwards but some localised falls
“The improvement in house prices over the year to date is being felt across most areas of the country. Annual house price inflation ranges from -0.9% in the Eastern region to +5.1% in Northern Ireland. Price inflation has turned positive in London (+0.2%), while prices are posting small falls in the South East, South West and East Midlands.
“There remain pockets of the country where house prices continue to post small falls on both a quarterly and annual basis e.g. Taunton (TA, -2.0%), Dartford (DT, -1.3%), Enfield (EN, -1.1%) and Harrogate (HG, -1%) postal areas. This highlights how house prices are still adjusting to the impact of higher borrowing costs in local areas.
“However, house prices are posting above-average annual gains in lower value and more affordable housing markets, often in proximity to larger cities e.g. Wolverhampton (WV, 3%), Oldham (OL, 2.8%), and Wakefield (WF, 2.7%) in England. House prices are rising even faster across the Scottish Borders from Dumfries and Galloway (DG, 4.4%) to Galashiels (TD, 3.1%) as well as in Falkirk postal area (FK, 3.1%) to the north and east of Glasgow.”
“The North East extends its lead as the regional property market growth leader with a very impressive year-on-year gain of 6.7%, while the East of England is now the worst performing region, indicating no change over the same period.”
“The North West once again recorded the strongest house price growth of any region in England, up by +4.0% over the last year, to sit at £232,917.
“London continues to have the most expensive property prices in the UK, now averaging £536,056, up +1.5% compared to last year.”
“The North East and North West are the only areas where average prices are currently rising in positive terms. Both areas are also seeing stronger price pressures than a year ago. The only other region registering a meaningful pick-up is London, although here average prices are still falling modestly year-on-year. Elsewhere, with the exception of the South West, annual price inflation continues to be negative and prices are falling by more than a year ago.
“The North East continues to have the highest proportion of unitary authorities and counties reporting higher prices year-on-year, followed by the West Midlands, North West and Wales, so we would expect some of these areas to see higher prices year-on-year when we report on August.”