According to a new report, North East house prices have continued their slow start to 2016 - falling by a further 0.4% in February.
The data revealed that prices have now slipped by 3.5% over the first eight weeks of the year – wiping £5313 from the value of an average home in the region.
A typical North East home cost £158,184 at the end of February - £571 less than January. Prices are nonetheless 8.5% and £13,312 higher than those recorded in the same period last year.
Several areas bucked the regional trend and saw prices rise – including Cramlington and Durham City (0.9%) , Washington (0.8%) and Peterlee and Gateshead (0.7%).
Blyth (-3%) saw the biggest drop, followed by South Shields (-1.6%) and Newcastle and Sunderland (-1.4%).
Whitley Bay has seen the biggest price rise over the past 12 months, recording a year-on-year increase in value of £14,003.
Prices in Blyth have dropped by 7.4% in the first two months of 2016 – making it this month’s Best Place to Buy.
43% of properties in Blyth are semi-detached (4% above the regional average), with a further 28% terraced (slightly below the regional average of 30%). 48% of properties have at least three bedrooms.
59% of homes are owner-occupied out-right, or with a mortgage – slightly below the regional average of 61%. 18% of homes are rented from registered social landlords or local authorities, 4% below the regional average. 12% of properties are rented privately, marginally below the regional average of 13%.
Rental Market Analysis
North East rents rose by £1 a week in February, rising from an average of £551 per calendar month four weeks ago to £555 today. Prices are £5 a month lower than in February 2015.
Blyth (£394) has replaced Easington (£425pcm) as the cheapest place to rent in the North East out of the areas surveyed, while Durham City (£818pcm) remains the most expensive.
Gateshead remains the region’s Buy to Let Capital, with an average return of 6.2% for investors. Other strong performers for rental yield include Peterlee (5.14%) and Newcastle and Seaham (4.8%)
Near flat house prices left rental yields unchanged at 4.2%.
The lowest rental yields continue to be found in Tynemouth where landlords can expect a 3.1% return on their investment.
Newcastle and Peterlee both saw investment returns rise by 0.3%, while yield in Morpeth rose 0.2% to leave investor returns 0.5% up over the first two months of the result – leading to the town being named this month’s Best to Invest.
28% of properties in the town are detached compared to a regional average of 16%. 19% of properties are occupied by two adults and one or two children, 17% by adults aged 16-64 with no children and 15% by single occupiers. 39% of properties have at least 3 bedrooms.
75% of properties are owner occupied – well above the regional average. Just 14% are socially rented, compared to 22% regionally.
Ajay Jagota, founder and Managing Director of local sales and lettings firm KIS Group, responded to the figures: “Blyth and Cramlington might be little more than four miles apart but the distance between house prices has changed by nearly 4% in just four weeks. It’s discoveries like that which show the real value of highly focussed geographical analysis like ours.
As estate agents you expect the first couple of months of the year to be amongst the quietest, and there are plenty of reasons why the regional property market has got off to a slow start to 2016 – not least the economic uncertainty in the air, which is likely to make buyers adopt a more cautious ‘wait and see’ stance.
As I was fortunate enough to get the opportunity to explain to BBC Breakfast this week, I am more and more erring towards voting towards a so-called Brexit in the EU Referendum, but that’s not to say that in the short term a significant amount of people are putting off buying a property until after June’s vote.
We’re still seeing a significantly more positive outlook for North East property than this time last year – only this week we saw the Housing and Communities Association report that housing completions in the region rose 25% last year, the highest percentage in the UK outside of London.”