Glasgow property prices rise as regional cities grow

Glasgow

Photo: Amateur photography by michel

The average value of homes across Britain rose by almost £7,000 – or 2.7 per cent – during the first six months of 2015, according to Zoopla. At the start of July, the average British house price stood at £270,674 – up £6,974 on January’s figure of £263,699.
 
Property values rose across all regions of the UK in the first half of the year, although at vastly different rates.

Indeed, while London has enjoyed the strongest growth in the past, momentum has shifted north of the border, with Scotland experiencing the highest rate of growth, reporting an average increase in property values of 6.6 per cent (£11,382): the average home value in Scotland now stands at £183,230.

The next-best performing regions were the North East and North West, registering a 3.1 per cent and 3 per cent increase respectively.

The figures are backed up by Hometrack’s latest cities index, which shows that Glasgow is one of the top three fastest growing cities in the UK, with prices up 6.4 per cent – only beaten by London (6.6 per cent) and Oxford (8 per cent).

The year-on-year rate of growth across all 20 cities covered by the index is 8.4 per cent with an average price of £226,200. At a city level, this ranges from 11.6 per cent in Cambridge to 2.9 per cent in Liverpool. Oxford and Cambridge continue to perform like extensions of the London market with all cities having a very similar profile of house price growth over the last 8 years. Northern powerhouse cities like Leeds, Manchester, Liverpool and Sheffield, mneanwhile, have all registered a pick-up in growth since 2013 but average prices are still below 2007 level.

Scotland was also a big winner, according to Zoopla, with Edinburgh registering the largest growth in house prices since January 2015 of 8.2 per cent, representing a £20,465 increase in the average home value in the city. Meanwhile, London performed slightly below the national average with average house prices in the capital growing by 2.5 per cent (£14,385) since January.
 
Lawrence Hall of Zoopla comments: “While national property price growth saw a slow start to the first half of the year, it recovered strongly towards the end of the period. The strong regional figures across the board indicate an economy which is returning to health, with a series of Government incentives designed to encourage home-buying helping to boost demand for property in all parts of Britain.”

“The real winner here is Scotland,” he adds. “The surge in property values can, in part, be explained as a post-referendum bounce, as businesses and capital flood back to Scotland, after withholding investment during the volatile September referendum period. A post-General Election feel-good factor must not be discounted as more devolution promised has given property prices a bounce as Scots anticipate more jobs and investment coming their way.”

Richard Donnell, Director of Research at Hometrack, highlights the strength of city markets across the UK.

“At 8.4 per cent, city level house price inflation is running higher than the overall UK rate,” he comments. “While house price growth might moderate slightly in H2 it looks increasingly likely that city level house price growth will return to double digits by the year end.”

“The greatest risk facing the housing market is an upward movement in interest rates which would check market sentiment, cool demand and result in a marked slowdown in house price growth,” he adds.

 

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