House prices prediction: North-South divide will continue to ‘narrow dramatically’ -expert

House prices: Expert discusses 'interesting' pricing differences

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House prices have continued to climb over the last few months, despite the Government’s stamp duty holiday coming to an end in September. The surge in buyer interest means the average house price in the UK has risen to a staggering £270,000, according to the latest house price index from the Office for National Statistics (ONS). The average property price has increased by over £28,000 in the last year alone.

But figures released by the Land Registry have revealed how prices in the northwest have climbed by 5.3 percent in the past three months.

Compared to the national average, a property in the northwest costs on average just £203,661.

Prices in the East Midlands have also risen by 14.7 percent since this time last year where homes are now worth on average £231,318.

Furthermore, house prices in the northeast have also gained 13.3 percent over the past year with the average home costing £152,776, making it the cheapest region in England.

Meanwhile, London has seen the slowest growth, with the cost of a home rising by only 2.8 percent over the last year.

The region remains by far the most expensive, however, the coronavirus pandemic has led to a “re-balancing” of prices between the north and the south, according to a property expert.

Property expert Jonathan Rolande from the National Association Of Property Buyers said the pandemic has turned the “price divide on its head” and the north-south divide will continue to “narrow dramatically”.

The coronavirus pandemic saw many homeowners take stock of their housing situation as they found themselves working at home and spending more time there.

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People’s homes became the office, the gym, a place for socialising and a place to relax.

Many London residents moved out the capital in search for bigger homes with more garden space that cost less.

The pandemic has also changed what type of property people are buying in the “race for space” with detached property prices increasing by 13.4 percent on average to £447,617.

By contrast, the value of flats has decreased but 5.8 percent to £241,884.

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Mr Rolande said the pandemic has actually had a “positive effect” on the housing market, helping to create a more fair market for buyers across England.

He said: “Unexpectedly, the pandemic-factor has had a positive effect on the market and there has been a re-balancing of prices between north and south.

“This should be embraced. London and the southeast have for too long dominated the wider economy and suppressed growth.

“Increased growth in the north, which I can see continuing, is helping to create a more equitable market.

“The slump in flat prices is caused not just by the new desire for outside space, but by adverse publicity around maintenance charges, sky-high ground rent increases, lease renewal costs and the cladding scandal.

“Buyers now want more control of their expenditure by purchasing freehold.

“Broadly, sustainable price rises are welcomed by many as they provide the ‘feel good factor’ to homeowners, encouraging them to spend in the wider economy and providing employment to local tradespeople and businesses.

“After the devastating financial impact of lockdowns, this is helping to jump-start the economy.”

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