The UK housing market is constantly in the news, whether the reports are about the shortfall of homes being built or debates over the merits of social housing. One area which tends to get missed out is the steady stream of good news concerning rising house prices.
With that in mind, the latest UK Cities House Price Index from Hometrack comes at just the right time and buy to let investors should be extremely happy with what is included.
The headline statistic is that annual house price growth across the UK is running at 3.9% as of the end of August, and Hometrack also states that there is further scope for growth in the cities which are currently growing the fastest – a far cry from many of the more gloomy reports which have been spawned by the ongoing Brexit process which still shows few signs of being resolved.
However, despite that uncertainty it is clear that the housing market remains an extremely strong prospect. The overall headline number is positive in itself but the numbers become even more interesting when we dig into specifics.
The annual growth of 3.9% is in spite of a 0.3% fall in London – the UK’s biggest individual city market and one of only three cities to see house prices retracting. The capital city is well known to be completely unaffordable for many, with recent reports from October stating that a salary of more than £50,000 is required to rent a one bedroom apartment in the city, and it is no surprise that more and more people are leaving every year.
Consequently, the Hometrack figures show that the fastest growth can be found in the most affordable regional cities. Places like Liverpool (7.5% annual growth) and Manchester (6.8% annual growth) are by now old favourites for buy to let investors, but what should be most encouraging is the continuing emergence of hotly tipped up and coming cities such as Leeds and Sheffield.
The Yorkshire cities recorded house price growth of 5.4% and 4.5% respectively – both well above average – and have been tipped by many as particularly interesting property investment markets for the future.
Both share similar characteristics which should interest investors; an impressive mix of private and public investment into their city centres; significant infrastructure improvements such as HS2 being undertaken to link them to the rest of the country more efficiently; rapidly growing populations and a shortage of rental stock; and booming economies which are attracting business from around the world.
This is the perfect time to look outside of London and take advantage of the growing house prices to be found in the regions beyond the capital city, and this is only confirmed by the latest UK Cities House Price Index from Hometrack.
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