The latest figures from the Land Registry have highlighted a more pronounced North-South property divide than ever, as the cost of an average London home has risen yet again, whilst there has been a significant fall in property prices in the North-East in the last month.
The cost of the average London property has now hit the inevitable milestone of £500,000; whereas the typical price tag in the north-east has dropped below £100,000, it has been reported.
Across the country as whole, property prices rose by 1% in September this year, reaching a UK average of £186,000, £6,000 higher than at the peak of the property boom back in 2007.
However, when you break the figures down, the regional variations are vast. In the last year, the average property has increased in value by 5%, whereas London’s prices have progressed at almost twice the rate at 9.6%.
It’s certainly a tale of two halves when examining figures from more northern locations. In north-west England, there is reasonable growth (2.5%), bringing the average property price to £115,000. In the north-east, house prices have fallen 0.3% in the last month alone, meaning that the average cost of a property here has dipped below £100,000.
This disparity is only set to increase in the coming year, and the half-million milestone looks set to be bypassed as London’s bullish sentiment continues to drive annual house price inflation upwards.
Howard Archer, UK economist at consultancy IHS Global Insight, commented: “Higher interest rates are unlikely to have a major dampening impact on housing activity for some time to come. Interest rates look increasingly unlikely to rise until well into 2016, while the Bank of England is stressing that when interest rates do start to rise, they will only move up gradually and to a limited extent.”