05 Nov 2018
The northern regions in UK appear to move independently of the affordability issues in London. The divide is expected to reverse in the coming five years where it is believed the rise in house price, on an average, will be 14.8 per cent in the country, even as, there will remain huge variations between North West and South East . The North -West price will increase at the rate of 21.6 per cent and the price in South East will increase by 9.3 per cent -- as per Savills data.
The investment in commercial properties continues to rise in UK where property experts Cass Business School believe the commercial market is on the verge of a boom. Its report finds the lending towards commercial properties increased by 27 per cent in the first half of the year to £22.5 billion.
London market, rent and affordability
Hometrack found 56 per cent of the postcodes depict month-on-month gains in London, although, the whole city of London is set on decline 0.4 per cent year on year. The reports find the fall in prices is concentrated in the inner regions of London, but, outer London remains affordable.
The report by Hometrack found the fastest growth in price was reported in Liverpool at 6.9 per cent, Birmingham 6.5 per cent, Leicester 6.4 per cent and Manchester 6.2 per cent. The growth in the top five cities was at the rate two times the growth in average wages. Rents are expected to increase by 13.7 per cent across regions and 15.9 per cent in London during this time.
In the residential properties, affordability has been a major problem where the savings for deposits is still one of the biggest issues for the buyers and challenges remain the same. Savills predicts, with the increase in wages, the house prices will increase in next 5 years. London may get a growth of 4.5 per cent and regions such as Wales and Scotland properties will rise by more than 20 per cent in the same time.
Manchester and Birmingham top growing cities
In the last five years, property market remained sluggish where NBS said the homeowners are not selling; that's why, a lower number of properties are in market. The reports by Savills claim the growth will increase the property rates by an average of £32,000 and slowest growth is expected to be seen in some of the markets of London where the prices are 72 per cent higher as compared to a decade ago.
As per Savills - in the next five years, the rise in property rates in the East of England and South East may be around 9.3 per cent and the leading regions that have capacity to perform the best are Manchester and Birmingham. Brexit had a negative impact on property market and also the buyers were worried over mortgage regulations, interest rates and the market overall. Further, the increase in interest rates, issue of affordability and other global politico-economic factors can hit the market.
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