There’s been a whole host of property stats coming out this month. As usual they’re generating some panicky headlines in the media.
And as usual they give conflicting messages.
We’ve recently looked at a whole series of surveys – from Halifax, from the RICS, from Chesterton Humberts, from Knight Frank – and from many more.
Although generally the message is consistent that house prices are fairly stable overall, there are significant regional variations – and you need to dig into the figures.
So while it’s always important to watch what the market is doing, it’s also important not to over-react to individual surveys and statististics.
One interesting report on house prices is this one from ONS, appearing in Property Reporter uk:
“ONS have today released figures that show that house prices across the UK remain relatively stable, with an increase of 2.3 in the 12 months to June this year.
The year-on-year increase reflected growth of 2.8 per cent in England, which was offset by declines in Scotland and Northern Ireland of 1.0 and 11.9 per cent respectively. House prices remained unchanged in Wales.
Annual house price increases in England were driven by a 6.5 per cent rise in London, and increases in the South West and South East of 2.3 and 2.2 per cent respectively. The only decrease in England was of 1.3 per cent in the North East.
On a seasonally adjusted basis, UK house prices increased by 0.5 per cent between May and June – prices of new dwellings rose by 5.9 per cent during the 12 months to June 2012, while the price of pre-owned dwellings increased by 2.1 per cent in the same period
In June 2012, prices paid by first time buyers were 3.1 per cent higher on average than in June 2011 while for owner occupiers prices increased by 2.1 per cent for the same period
Average house prices in countries and regions
– Average mix-adjusted house prices in June 2012 stood at £240,000 in England, £154,000 in Wales, £131,000 in Northern Ireland and £180,000 in Scotland.
– In June 2012, London continues to be the English region with the highest average house price at £392,000. The North East had the lowest average house price at £144,000.
– London, the South East and the East of England all had prices higher than the UK average price of £231,000.
– Excluding London and the South East, the average UK mix-adjusted house price was £187,000
House Price Index by type of buyer
– The average price for properties bought by first time buyers increased by 3.1 per cent over the year to June 2012 compared with an annual increase of 2.9 per cent in May 2012.
– During June 2012 the average price paid for a house by a first time buyer was £173,000. The average price for properties bought by former owner occupiers (existing owners) increased by 2.1 per cent in the year to June 2012 unchanged from an increase of 2.1 per cent in May 2012.
– In June 2012, the average price paid for a house by a former owner occupier was £266,000.”
You’ll have noticed straight away that prices in the South West are performing strongly, compared to the rest of the UK. Obviously as Bristol (and Bath) specialists, we’re always pleased to see this – and we remain very confident about the prospects here, over the long term.
(London of course is an entirely different market with a strong foreign investment element – and always performs well).
We’ve noticed an increasing number of surveys and commentators highlighting the ongoing “North / South” divide – and most indicate that it continues to widen.
We’ve also noticed that the surveys based on consumer confidence, rather than actual sales prices, often report more pessimistic outcomes. No doubt this reflects negative media coverage. The overall figures also don’t reveal significant age demographic variations, as well as geograhic ones. Typically older people are less confident about values.
It’s also important to remember that these consumer surveys don’t reflect the type of analysis that a professional investor will make. They don’t look at investment returns, but are focussed on prices for buying a home to live in.
Our advice is to keep watching these surveys and make sure you have a feel for the markets – but the most important thing is to make sure you invest in a market you know, with good prospects and with expert advice. It really is essential that you invest in the right property at the right price and that you understand the returns.
(For more comments on the Chesterton Humbert’s survey, check out my latest blog on my personal Del Brown website too).
To Your Property Success,
Del Brown – Property Options