Demand pushes house price growth to 15-month peak

Demand pushes house price growth to 15-month peak

The latest report from Hometrack has recorded a further jump in the rate of house price growth to 11.4%, up from 10.2% the previous month and 8.9% twelve months ago.

This represents the highest rate of growth for 15 months as demand increases in the face of constrained supply not least from property investors who accounted for 1 in 5 of all buyers in 2015.

Richard Donnell, Insight Director at Hometrack, said: “With cities the focus of economic and demographic change it is no surprise that city level house price inflation continues to run ahead of UK house price growth which has also risen to 7.9%. The performance of house prices across these cities reflects the scarcity of supply and underlying demand for homes. Thirteen of the twenty cities have recorded continued growth in house prices for over 6 years with the remaining seven registering recovery in house prices between 2 and 4 years.”

Cambridge has seen the highest annual rate of growth at 14.4% followed by London 13.8% and Bristol 12.8%. Prices may be rising but overall sales volumes across Cambridge and London look on track to be lower over 2015 as scarcity of homes for sale and affordability pressures limit overall volumes.

Meanwhile Aberdeen has seen house prices fall in the last year by 1.4% as housing demand weakens on the back of sharp drops in oil prices and the local economic impact of falling investment in oil and gas. Newcastle and Sheffield are recording the next lowest growth rates of 3.7% as prices rise slowly in cities where the housing recovery is at a much earlier stage.


Richard Donnell added: “Looking across the 20 cities the impetus for growth continues to come from regional cities where prices are rising off a low base as household confidence improves and home owners utilise record low mortgage rates to access the market. Glasgow and Liverpool have recorded a significant increase in house price growth over the last 12 months in cities where the recovery has been running for just 2-3 years.”

Adrian Whittaker, Sales Director, New Street Mortgages, commented: “Going into 2016, house prices have continued to increase against seasonal trends. This unseasonal increase and the highest rate of growth for 15 months is representative of a market that is becoming more competitive and, in this environment of rising demand and limited supply, the time it takes to get a mortgage approved matters more than ever."

Jeremy Duncombe, Director, Legal & General Mortgage Club, added: "This 15 month high in house prices demonstrates that housing demand is continuing to exceed supply, pricing potential buyers out of the market. The significant disparity between the prices of homes in different areas of the UK is particularly concerning as it forces people to buy further away from their first choice location, or move to a property which may not best suit their specific needs, potentially disrupting their lifestyle.

More houses need to be built around UK cities to enable people to live in their desired areas. The Government should also look at ways in which they can encourage more efficient use of current housing stock to help people to ‘rightsize’ to a more suitable property. This would help to free up larger homes, create more space for growing families to upsize and, in turn, give rise to a more fluid property market. Additionally, any avenues that the Government can explore to make housing construction more time efficient should also be explored in order to boost the supply of new build properties.”

Join our mailing list:

Leave a comment



Our Next Event

Commercial Finance Roadshow May 2017

Commercial Finance Roadshow May 2017

Exeter - 23/05/2017

Southampton - 24/05/2017

Rainham - 25/05/2017

Milton Keynes - 26/05/2017

Register now

Latest Comments

warren
warren 26 Apr 2017

You're very welcome Mary! Glad you enjoyed them :)

view article
Mary Ward
Mary Ward 26 Apr 2017

Thank you for the wonderful ideas. First impressions can make or break a deal. It's sadly that many homeowners drop the kerb to create an off-street parking space.

view article
Tony Gimple
Tony Gimple 14 Apr 2017

I'm not at all surprised that so many landlords are still confused about what the tax changes really mean and how it will affect them. In particular, the blind rush to incorporation is leaving landlords...

view article
MH
MH 13 Apr 2017

You are right that the bank holidays are going to be spoiled in looking for the properties. But people who want to sell their property and looking for the better relocation, they can get benefits of this...

view article
bnellyb
bnellyb 08 Apr 2017

There will be an exodus of private landlords over the next 5 years as tax changes take effect, private landlords provide an important service to the rental market, why do housing associations and councils...

view article
Fred Cassman
Fred Cassman 07 Apr 2017

"Make it look like you are at home": often people forget this and share on facebook their location!

view article
jared townsend
jared townsend 05 Apr 2017

It'll be interesting to see how & if the Government's asset sale regarding mortgages helps

view article
SecomTech
SecomTech 04 Apr 2017

...and not one mention of the rules on PERMITTED DEVELOPMENT!!! Unless you have studied the plans you will not know...It's probable a high proportion would not need planning permission...BUILDING Control...

view article
Jonathan
Jonathan 03 Apr 2017

That's a very interesting study indeed. There is no doubt that new services and web apps such as Wonego.com in the UK or Roomster in the US will change the way people look for a flatmate, and that tenants...

view article
MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

view article
ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

view article
NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

view article

Related stories

More articles from Property