A typical property in the region is currently valued at £166,574 – a month-on-month jump of £1823 in cash terms.
The rise compares to a fall of 2.3% recorded in August 2016 and follows falls in six of the previous seven months. Prices rose 1.8% in August 2015 and 1.2% in August 2014.
Prices are also 4.3% higher than those of twelve months ago, with a typical house now valued at £9137 more in cash terms than twelve months ago.
Prices were up in 14 of the 20 areas surveyed, with property values rising fastest in Durham City (3.9%), Killingworth (3.8%) Houghton-le-Spring (2.7%) and North Shields (2.3%)
House values fell in Easington (-2.1%) Blyth (-2%) Peterlee (-1.7%) Cramlington (-1%) and Jarrow (-0.1%)
Prices in Peterlee have performed the strongest over the past 12 months, rising by 6.3%. Other strong annual performers include Gateshead (5.6%) South Shields (5.4%) and Killingworth (5.3%).
Rental Market Analysis
North East rents rose slightly to £605 per calendar month – but remain 0.6% lower than twelve months ago.
Average rental yields have risen slightly with, with property investors currently seeing an average return on their investment a little under 4.4%.
Investors in North East property continue to see noticeably higher returns than those who have invested in London (average yield 3.2)
Blyth (£427) continues to be cheapest place to rent in the North East out of the areas surveyed, followed by Houghton-le-Spring (£444). Tynemouth (£1094pcm) again the region’s most expensive in general terms.
Peterlee is yet again the region’s Buy to Let Capital, with an average return of 6.3% for investors. Other strong performers for rental yield include Gateshead (5.6%) and South Shields (5.4%).
Ajay Jagota, founder and Managing Director of Keep It Simple, said: “Last month I wondered whether the slow reversing of North East house prices we’ve seen over the past few months was a trend or a blip – we could very much say the same about this month’s 1.1% increase.
With Parliament resuming next week what lies ahead depends on coming government interventions and whether they stifle or advance the market.
What is clear though is that despite a lot of gloomy talk in the media about ‘tumbling house prices’ not only have average North East house prices risen by close to £10,000 over the past 12 months, our monthly growth is not only consistent with rises recorded in previous Augusts – it significantly surpasses the 2.3% drop we saw this time last year.
National data suggests that across the country house prices fell 0.1% in the last period for which figures are available, with annual growth running at about 2.1%. On the basis of those figures the North East is out-performing the rest of the country, with prices rising twice as fast as national averages as a whole and even faster in places like Peterlee, Gateshead and South Shields.”
Rental yields have also kept pace with capital appreciation, and I challenge investors to find a savings rate comparable to the 3.4% return you would see from a modestly performing area like Washington, let alone the 5.4% or more you can get in South Shields.”
