Market conditions across the UK’s major cities remain a mixed bag, but which locations are currently leading the way – and which ones are the most future-proof?
The latest Zoopla cities house price index (powered by Hometrack) has revealed that the top cities for house price growth over the last 12 months to September were Leicester with a 4.5% increase, Manchester with 4.4%, Liverpool with 4.3%, and Belfast and Edinburgh both with 3.7%. These five cities saw significantly more growth than the UK average of 2.2%.
The results reveal that the northern housing market is still outperforming the south, and the north-west in particular has gone from strength to strength in recent years. Demand in the area is high, making it an ideal spot for all range of buyers from first-timers looking for better value to property investors hoping to tap into the strong rental markets and yields on offer there.
Pockets of positivity
But it isn’t as positive elsewhere in the country, with Aberdeen and Oxford both seeing price drops over the past 12 months of 5.5% and 0.9% respectively, while London house prices only increased by 0.1%, Portsmouth by 0.5% and Cambridge and Southampton by 0.8%.
While there are certainly pockets of the south that are performing well, with planned future investments and infrastructure improvements buoying certain areas, there is a general north-south divide in the data, and not just in property price growth.
According to the research, the average time it takes to sell a property across UK cities has risen to 12 weeks – compared to eight weeks in 2016 – and people are shaving an average 3.8% off their original asking prices compared to 2.2% three years ago.
Houses getting snapped up
However, some cities are bucking this trend, mainly in areas where high demand means properties are snapped up much faster than average. The cities where homes sell in eight to nine weeks, and with asking price discounts of only 2-3%, are Manchester, Birmingham, Leeds, Nottingham, Cardiff, Leicester and Sheffield.
Richard Donnell, Hometrack director, commented: “These cities have registered steady, above average house price growth over the last one to two years as demand for housing is sustained on the back of rising employment and attractive affordability.”
Donnell also points out that the housing market’s current polarisation across the country is “set by underlying market fundamentals”, with Brexit uncertainty having some effect.
He continued: “Market conditions are set to remain weak in southern cities until pricing levels adjust to what buyers are willing, or can afford, to pay. London is three years into a repricing process, and we expect sales volumes to slowly improve over 2020.
“However, as we highlight in this report, there are large parts of the country where housing affordability remains attractive and continued economic growth is supporting housing demand, leading to shorter sales periods and lower discounts to asking prices.”