According to the latest figures released by Hometrack, UK city house price growth is picking up momentum with house price growth in the first quarter of the year at 3.5%, the highest quarterly rate of growth for three years. This has resulted in the annual growth rate increasing to 6.4%, up from 4.9% at the end of 2016 Q4.
Hometrack, a property market intelligence provider of choice for major mortgage lenders and house builders, also reported that the impetus for growth is stemming from large regional cities such as Newcastle, Glasgow and Edinburgh. Manchester remains the fastest growing city covered by UK Cities House Price Index where the annual growth rate is 8.8% followed by Birmingham at 8.0%.
Attractive affordability levels, record low mortgage rates and an improving economic outlook are reasons supporting the demand for housing, according to Hometrack. In addition, limited availability of stock for sale contributes to an upward pressure of house prices.
In contrast, house price growth in some areas of the south including London, Oxford and Cambridge has slowed for the first time in five years as affordability pressures and tax changes for investors, constrain demand.
As with all significant national events, such as a General Election, we may expect to see some short-term uncertainty although according to Hometrack, comparing the profile of sales volumes between election years and non-election years, there is no material difference.
Buyers outside the south of England appear to be shrugging off concerns over Brexit, choosing instead to take advantage of low mortgage rates.
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Here is the full UK Cities House Price Index report: hometrack-uk-cities-house-price.pdf
*source: Hometrack, UK Cities House Price Index, March 2017.