The northern regions in the UK appear to move independently of the affordability issues in London. The divide is expected to reverse in the coming five years where it is believed the rise in UK house price, on an average, will be 14.8 percent in the country, even as, there will remain huge variations between North West and South East. The North -West price will increase at the rate of 21.6 percent and the price in South East will increase by 9.3 percent -- as per Savills data.
The investment in commercial property continues to rise in the UK where property experts Cass Business School believe the commercial market is on the verge of a boom. Its report finds the lending towards commercial property increased by 27 percent in the first half of the year to £22.5 billion.
London market, rent and affordability
Hometrack found 56 percent of the postcodes depict month-on-month gains in London, although, the whole city of London is set on decline 0.4 percent year on year. The reports find the fall in prices is concentrated in the inner regions of London home price but, outer London remains affordable.
The report by Hometrack found the fastest growth in price was reported in Liverpool at 6.9 percent, Birmingham 6.5 percent, Leicester 6.4 percent and Manchester 6.2 percent. The growth in the top five cities was at the rate two times the growth in average wages. Rents are expected to increase by 13.7 percent across regions and 15.9 percent in London during this time.
In the commercial properties, affordability has been a major problem where the savings for deposits is still one of the biggest issues for the buyers and challenges remain the same. Savills predicts, with the increase in wages, the house prices will increase in the next 5 years. London may get growth of 4.5 percent and regions such as Wales, Scotland property and housing market Scotland will rise by more than 20 percent in the same time.
Manchester and Birmingham top growing cities
In the last five years, property market remained sluggish where NBS said the homeowners are not selling; that's why a lower number of property are in the market. The reports by Savills claim the growth will increase the property rates by an average of £32,000 and slowest growth is expected to be seen in some of the markets of London where the prices are 72 percent higher as compared to a decade ago.
As per Savills - in the next five years, the rise in property rates in the East of England and South East maybe around 9.3 percent and the leading regions that have the capacity to perform the best are Manchester and Birmingham. Brexit had a negative impact on the property market and also the buyers were worried over mortgage regulations, interest rates and the market overall. Further, the increase in interest rates, issue of affordability and other global politico-economic factors can hit the market.
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