Regional Property Growth: A Look at Recent Developments
Steady Growth and Regional Highlights
The UK housing market has shown a steady upward trajectory, with the North West leading in regional property growth. This region continues to lead the charge, demonstrating robust growth that contrasts with the overall market’s general increase.
Recent data indicates that the housing market is on a positive path, bolstered by the prospect of further interest rate cuts and a strengthening economy. The latest Halifax House Price Index reveals a 0.3% rise in property prices month-on-month, with the average property now costing £292,505. This figure represents a 4.3% increase compared to the previous year and marks the fastest annual growth since November 2022.
Despite only a single reduction in the Bank of England’s base rate this year—from a 16-year high of 5.25% to 5%—this move has instilled a sense of confidence in the market. Halifax attributes much of the current market growth to this shift, which has generated a ripple effect throughout the property sector.
Regional Property Growth: Resilience in the UK Housing Market
The UK housing market has shown remarkable resilience despite various challenges. This resilience is highlighted by Amanda Bryden, Head of Mortgages at Halifax, who notes that the average property price is now just £1,000 short of the record high set in June 2022 (£293,507).
Bryden remarks, “The durability of house prices is evident, and with increased market activity and the potential for further interest rate reductions, we anticipate a continuation of modest growth throughout the remainder of the year.”
Nathan Emerson, CEO of Propertymark, echoes this sentiment, stating, “It is heartening to see an uptick in consumer confidence within the housing market. We appear to be on a positive growth trajectory after a period of significant volatility. As lower inflation and interest rates take effect, we expect further market growth as the year progresses.”
Regional Performance: Northern Ireland, Wales, and the North West
The housing market varies significantly across the UK, with Northern Ireland leading in terms of house price growth. Between August 2023 and August 2024, prices in Northern Ireland surged by 9.8%, bringing the average property price to £201,043.
Wales also exceeds the national average with a 5.5% annual increase, pushing the average home price to £224,433.
However, within England, the North West stands out as the region with the most substantial growth. Property prices in the North West have climbed by 4% over the past year, resulting in an average price of £232,917. This region is experiencing strong growth and offers below-average property prices. Consequently, it is an appealing option for investors seeking capital growth at a lower price point. Additionally, higher-than-average rental yields make it a valuable location for rental investors.
Industry Perspectives on Market Trends
The latest Halifax report has received positive feedback. Nicky Stevenson, Managing Director at Fine & Country, says, “August saw an uptick in house prices, setting the stage for a strong autumn. September transactions typically exceed August by 12%, a trend likely to continue.”
She adds, “The Bank of England’s recent rate cut and the possibility of another should energise the market. Inflation remains near the 2% target, which should boost buyer confidence in 2024.”
Stevenson also notes, “A 14% increase in housing supply as of August should help moderate price inflation. The number of homes for sale has hit a seven-year high, balancing demand. While potential tax increases and affordability challenges may impact the market, cautious optimism suggests steady growth.”
Iain McKenzie, CEO of The Guild of Property Professionals, notes recent data has been mixed but today’s figures look promising. “Market activity has increased over the summer, and economic indicators are positive.”
He adds, “Headline inflation is stabilising just above 2%. However, affordability issues persist. The reaction of high-street banks to falling rates will be key. We may not see immediate lower borrowing costs or more mortgage offers.”
McKenzie concludes, “A housing undersupply continues to support prices. The new government’s focus on increasing supply may help but won’t cause a sudden price drop. Buyers, especially families wanting to move before Christmas, are likely to drive prices up.”
Regional Property Growth: Conclusion
The UK housing market is demonstrating a steady and resilient growth pattern, with notable regional variations. The North West, in particular, is showing impressive growth while remaining an attractive area for property investors. Positive economic indicators and adjustments in interest rates should sustain this upward trend. However, ongoing challenges and potential tax changes might influence the market’s trajectory in the coming months.
