(qlmbusinessnews.com via telegraph.co.uk – – Fri, 22nd Feb 2019) London, Uk – –
The recent slump in house price growth has been blamed by many experts largely on the political and economic uncertainty caused by the Brexit vote – but there are some areas of the country that have bucked this trend.
According to Nationwide’s latest house price index, house price growth “ground to a halt” in January, with prices just 0.1pc higher than the same time last year. Estate agent Jeremy Leaf said the figures confirmed a market “struggling to weather the Brexit storm, but not collapsing”.
While some areas in London and south-east England have seen considerable falls in growth since Britain voted to leave the European Union in June 2016, the opposite is true for many other regions across the country.
Buying agent Garrington Property Finders analysed Land Registry data to identify the regions in England and Wales that have weathered the Brexit storm, and are likely to see future house price rises. Its research is based on two determining factors of future appreciation – property affordability (house price to earnings ratio) and the pace of job creation.
It found that property increased in price in East Staffordshire in the West Midlands by 10pc in 2018, four times higher than the UK average of 2.5pc. It also has a good ratio of affordability in the area and a high employment growth rate, making it the top “Brexit-proof” property hotspot in the country.
The area's robust economy means jobs are being created at a prodigious rate, with local employment growing by 9.4pc in 2018, almost eight times faster than the national rate of 1.2pc, while its affordability ratio is 7.7.
The second-placed market in the ranking was Rochdale in Greater Manchester, which clocked price growth of 8.7pc and employment growth of 7pc in 2018, yet has a good affordability ratio of 5.6, second only to Liverpool’s 5.1 ratio.
All 10 areas in the league table have an affordability ratio – the average property price divided by the average resident’s salary – lower than the England and Wales average of 7.77 (London’s is 12.36, according to the ONS), and a rate of job creation in excess of the national average.
Derby, Derbyshire, Salford, Greater Manchester, and Bassetlaw, in Nottinghamshire, round out the top five, with property price growth in 2018 of 7.7pc, 6.9pc and 6.8pc respectively.
Jonathan Hopper, managing director of Garrington, said that while at a national level the property market is cooling to the point of inertia – with average prices rising at the slowest pace for five years – a number of hot micro-markets have emerged that completely buck the trend.
Mr Hopper said this includes the Midlands which currently has a “combination of Brexit-defying economic momentum, good affordability and, above all, strong future growth potential.”
The Royal Institution of Chartered Surveyors (Rics) has previously predicted that national house price growth will come to a “standstill” this year, but a supply shortage “will negate outright falls”.
Halifax’s Russell Galley is more bullish, however. “On the basis that it is still most likely that the UK exits the EU with a form of withdrawal agreement and transition period”, he said that he expects annual house price growth nationally to be between 2pc and 4pc by the end of the year.
By Sophie Christie