The UK property market’s widespread strength so far in 2014 continued in August, with house prices having increased for the eighth consecutive month, according to the latest published figures from home.co.uk.
It said that in August, UK house prices climbed by an average for 0.2 per cent, meaning that every single month this year has seen an increase in house prices.
For the year as a whole, this also means that people who have bought homes as homeowners or as a buy-to-let investment have seen an overall capital appreciation of some nine per cent so far.
The figures from the company showed that there is still a real sense of demand and competition in the British property market. In the past year, there has been an increase of just three per cent in the number of homes for sale, which has meant people paying more.
One area in particular where there has been an increase in demand from investors has been the student accommodation sector. An increase in the number of people applying for courses in 2014 – which has climbed by almost four per cent – has meant demand has soared among buy-to-let investors. In the past three years, home.co.uk reports, there has been some £6 billion invested in this particular area of the market.
Paul Smith, chief executive officer of haart, said that part of the rising demand among both investors and end users has been the fact that people are anticipating a rise in interest rates, which the Bank of England has suggested could come at some point in 2015.
“Despite this influx of stock the market remains competitive with an average 9.5 buyers registering interest in every new home that comes to market, which is the driver behind property price growth,” he said.
“People now see the reality that interest rates will rise early next year but are keen to take advantage of current market conditions.”
Speaking of the future in the sector, Howard Archer, chief economist at IHS Global Insight, said that the market looks set to continue to grow in the months ahead.
“With the economy seen holding up pretty well going forward, employment high and rising, consumer confidence elevated and earnings growth likely to improve (particularly in 2015), and with housing supply still tight in a number of areas, house price growth seems unlikely to fall away,” he said.