UK cities are seeing investment property prices falter, although Northern cities are pulling ahead.
Edinburgh, Birmingham, Glasgow and Manchester have all recorded growth of 7 per cent or more per annum according to the December Hometrack Cities Index. However, across the UK prices have dropped to 5.4 per cent.
Edinburgh topped the list of UK cities, with annual growth reaching 8.2 per cent. This pulled the average price to £218,600. Closely following was Birmingham, up 7.5 per cent to £154,100. Glasgow and Manchester came in third and fourth, up 7.2 per cent and 7 per cent respectively.
London house prices saw the slowest annual growth at 1.8 per cent. This took the average price to £488,400. The report also fond an increasing amount of price discounting in the city. An average discount of up to 4 per cent can now be offered against properties, with the largest discounts of up to 10 per cent being registered in inner London where price decline is most concentrated.
Managing director of buy to let specialist, Sequre Property Investment, Graham Davidson, commented: ‘As expected, key northern cities are dominating UK growth. Manchester and Liverpool have remained among the strongest contenders with other cities such as Nottingham and Birmingham also among the top areas for property growth. For buy to let investors, these are the cities to be looking at over the next 12 months. Those who haven’t already moved away from the London market are advised to act quickly – not only have the rental yields remained virtually non-existent, but capital growth is also declining. Cities like Manchester and Liverpool offer much better property deals in both the short and long-term.’
Director at Ascend Properties, Ged McPartlin, added: ‘To see cities like Manchester and Liverpool far surpass London in terms of growth truly reflects the strength of the property market within the north west. For so long it was believed London reigned supreme in the UK and the report drives home that that is simply not the case. An unfortunate result of this has been the shortage of stock in cities where demand has been so high – young buyers are unable to get on the ladder due to the severe lack of housing. The focus on the build-to-rent market in particular creates a massive imbalance in certain areas that will continue to drive up prices for first time buyers and until more affordable homes are brought to the market then many will continue to miss out.’