Hometrack report says London house prices will drop by 3% in 2017

Hometrack report says London house prices will drop by 3% in 2017

Average house prices across London are forecast to fall in 2017 whilst property prices in the rest of England and Wales are expected to increase by 2% to 3%, the report states.

The East of England and the Midlands are expected to see the biggest growth as rents are currently rising by close to 5% the analysis showed.

House prices in England and Wales reach new peak

Residential rental growth has varied dramatically over the last couple of years. Depending on region and other local economic factors as well as earnings, increases changed by anything between 45% to -7%.

London still has the lowest rental affordability according to Hometrack. The demand for rental housing has grown significantly over the last decade and effects can be felt across the country, however region outside of England’s South shot the highest levels of affordability.

The Hometrack report analysed data tracking back to 2004 and revealed that rents dropped by 6% to 12% during the financial crisis, a time in which accidental landlords entered the market whilst limited employment weakened demand.

Following this, from 2010 onwards, rental growth outside of the capital has mainly tracked the growth of average earnings with a median of 2.7% annually.

London has overall seen a steeper increase in rental prices with an average of 4.5% yearly. The city, however, also experienced weaker rates during 2013 and 2017.

Average UK house prices increased by over 40% since 2009

The report continues by highlighting that increasing house prices and tighter lending criteria keep making it harder for first-time buyers to own their home.

The analysis also showed that rental affordability across the country has remained fairly stable over the last 12 years with rental costs accounting for 27% to 32% of the average annual income.

This may not come as a surprise as tenants naturally only have a certain amount of funds available for rent. This aspect of the property market also makes investing in buy-to-let such a lucrative business for many as it is an asset class where the underlying performance is linked to earnings growth.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:

STAY AHEAD OF THE MARKET

Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment

FIRST FOR NEWS AND KNOWLEDGE.

Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:

 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

 

+852 6699 9008

Open from 9am-6pm HKT