The MOMENTUM behind the housing market recovery is shifting away from some cities in southern England and towards places like Leeds and Sheffield in the North according to a new report.
This is because many Northern cities have only recently seen house prices start to rise in the last two or three years while it in the South it has been ongoing from up to five or six years.
Property analyst Hometrack said today that the strong property price growth which has already been seen in cities such as London and Oxford since 2009 will restrict the ability of values to increase further in these cities in the future.
Average property prices in both these areas are now more than 12 times local annual earnings, which is almost double the UK average of 6.3 times wages.
Hometrack’s analysis shows that the housing markets in many of the UK’s main cities, including London, Aberdeen, Cambridge, Oxford, Cardiff, Manchester and Birmingham, all reached a trough around six years ago, after which time, prices started to recover.
By contrast, property prices in Sheffield only started to recover around three years ago, while those in Glasgow, Leeds, Edinburgh, Newcastle and Liverpool have only been in recovery for two years and those in Belfast have been edging up for a little over 18 months.
The cities which only started their housing market recovery a couple of years ago tend to have house prices which are more affordable when compared with earnings, averaging between three and six times local wages, said Hometrack.
This could give prices more wriggle-room to push up further in the North.
The average property price in London has piled £144,278 onto its value to reach £405,500 since the market in the capital bottomed out in April 2009.After London, Oxford and Cambridge have seen the strongest house price growth since values there started to recover, with a typical home buyer in these areas facing paying £100,000 more than they would have done six years ago.
But not all cities where house prices have been recovering for some time have seen strong growth in values over that period. In Manchester and Birmingham for example, property values have grown by around £13,000 over the six years since the recovery started in these areas.
In Leeds houses average house prices went down to £139,900 in October 2012. Since then it has increased by £12,886. In Sheffield houses average house prices went down to £126,900 in November 2011. Since then it has increased by £11,947.
It was also announced today that property sales in the first ten months of 2014 were 21 per cent higher than in the same period in 2013, according to new research by Lloyds Bank. This was the highest for this period since 2007.
In Yorkshire the figure was 23 per cent.
Pudsey and Selby are among the country’s top property sales hotspots, having seen big jumps in the number of transactions taking place last year, according to the report. The East Midlands saw the biggest year-on-year increase in house sales in 2014, recording a 26% upswing, according to the research from Lloyds Bank, which is based on Land Registry data covering England and Wales. The research compared the number of property sales in the first 10 months of last year with those in the first 10 months of 2013. Around 760,000 sales took place across the country between January and October, marking a 21 per cent increase on the same period in 2013.