Experience Invest reviews the latest reports about rising house prices in the United Kingdom.
Rising property prices is something which is reported on a weekly basis.
Across the board, property prices have exceeded their 2008 peak and, with an ever-recovering economy and rising consumer confidence, prices are set to continue to rise.
It is thought by the Centre of Economics and Business that UK property prices will soar by 25% within in the next five years.
Economist Nina Skero, author of the report, said: “A reduction in the number of properties being put on the market has placed further upward pressure on house prices in some parts of the UK.
“This is a result of low levels of housebuilding but also other factors such as an ageing population and the rising cost of moving up the property ladder.”
The report shows that the average cost of a property could reach £263,000 in 2015. Prices may increase by a further 3.5% in 2016 and 4.2% in 2017.
Data shows that eventually, the average price of a property could reach £321,600 by 2020 (£58,600 more than it would cost today).
The £1 million town
As property prices outside of London rise, news of the ‘£1 million town’ hit the headlines this week.
Data from Lloyds Bank has revealed that some key locations outside of London are now averaging property prices around the £1 million mark.
The research shows that typical property in Virginia Water in Surrey will cost £1.16 million and Cobham (also in Surrey) will set buyers back £1.01 million.
St Albans – a popular commuter town outside of London – saw eight times as many £1 million or up transactions in the first part of 2015.
Despite rising prices in this area, Property Wire recently reported that sales of houses priced over £1 million dropped in the first 6 months of the year.
Data from Lloyds Bank shows that the number of million pound house transactions dropped by 11% in the first half of 2015.
When compared to the first half of 2014, when the sector witnessed a 46% increase, there has been a sharp decrease in the amount of people buying expensive property.
‘The number of homes sold for over £1 million has fallen sharply over the past year, with a pronounced slowdown in the prime and central London market. This may be the effect of the new Stamp Duty rates introduced last December and uncertainty generated by the election in May,’ said Sarah Deaves, private banking director at Lloyds Bank.
Under supply of property
There is no doubt that there is a lack of new-build housing in the UK.
The government has attempted to tackle the issue of new build, affordable housing however, it is yet to be seen if election promises will yield anything.
An overall undersupply and a high demand from first-time buyers and investors will no doubt accelerate the price of property in the UK.