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What is really going on in the UK property market?

By recruitment expert and AMR Regional Director Mike Spencer
 
If you believe everything that you read in the media, the property market could be up by 5% one day then down by 10% the next, but what do the statistics really tell us? 
 
In a sign of economic revival, this month has seen year-on-year property price rises across the whole country.  According to Nationwide Building Society, prices are rising at their fastest rate for five years, meaning that the average house value, £172,127, is at its highest level since 2008. 
 
The North/South divide
Although the price rises reported by Nationwide are predominantly driven by the south of the country, all regions have reported a growth in the second half of the year.
 
Northern Ireland has seen its first increase since 2007, and Manchester and Newcastle saw their property prices rise by 10% and 8% respectively.
 
However, with property in the south typically 74 per cent more expensive than its counterpart in the north, the gap between the average property price has widened to £100,000 for the first time. 
 
The London market
 
The property market in the country’s capital has always stood out on its own and regularly dwarfs all other areas.  
 
It has once again bucked the national trend with property prices already exceeding the 2007 peak by 8%; the average house price in London now stands at a staggering £476,000.
 
Full market recovery 
 
Whilst the latest figures are extremely encouraging for the property market as a whole, the average price is still 7.5% below the level in 2007.  However, if the market does continue to grow at the current rate, experts predict that it will have fully recovered from the credit crunch by the end of next year. 
Due to the new Help to Buy mortgage scheme, first time buyers are once again having an impact on the latest property figures.  Those taking their first step on the housing ladder make up the majority of people using the scheme, with Halifax having received 1,309 applications in the first month.
The Land Registry’s figures also indicate a renewed buoyancy in the market with sold values in England and Wales rising by 1.5% in September alone. 
 
The Future
 
With the figures showing that the stagnating property market is starting to recover, estate agent, Savills, is predicting house prices to rise by up to 25% across London and the South East, 21% in the rest of the south of the county and 18% in the north. 
The recovery of the property market can only be a good thing for the economy, as an increase in the property market is generally a precursor for confidence in other areas of business.
 

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