New data has shown property expert Simon Morris that the South of England’s housing market is outperforming the rest of the UK’s by significant volumes.
Hometrack house price index
Residential property analyst Hometrack has recently released their latest house price index. It shows that UK house prices rose by an average of £11,500 in the year to May 2015. Meanwhile, it also illustrated that the UK average house value increased 0.8% in May on a month-by-month basis, bringing this average to 3.8% above its 2007 peak level.
South vs. North
Analysis shows that average house prices rose at a faster rate in cities across the South of England than anywhere else in the UK. Oxford registered the highest rise; the university city saw an average house price uptick of £41,700 in the year to May. London followed at £38,900, whilst fellow university city Cambridge came third at £23,900.
In contrast, the North of England failed to perform as admirably. Sheffield registered the highest rise; the South Yorkshire city saw its average house price increase £5,300 in the 12 months to May 2015. Newcastle followed at £4,700, whilst Liverpool brought up the rear, with its average house price increasing £4,200 in the year to the fifth month of 2015.
Cities making gains at different rates
Hometrack’s director of research, Richard Donnell commented on the data. He said: “House prices have picked up momentum post-election. An increasing proportion of households are feeling the benefits of the improving economy, which means that house price growth is set to continue in the coming months. The greatest risk is an earlier than expected increase in interest rates which would knock market sentiment.”
Donnell went on to explain: “The strong demand side recovery seen in southern England has yet to spread to other cities revealing the diverse nature of the housing market. All cities are making gains at different rates of growth, but the cities with the biggest increases all have something in common and that is strong local economies.”
Investing pensions in property
This could be a significant finding for investors who are looking to take advantage of pension reforms to invest in buy-to-let. This data provides investors with information that could help them ensure they target a lucrative market.
However, Simon Morris would advise potential investors to think carefully before they remove their pension as a lump sum to invest in buy-to-let. There are many risks attached to this capital generation strategy, so Simon would suggest they read his latest guide before they choose to take this course of action.