Annual UK house price growth reached nine per cent in September, showing a marginal increase from August, according to Hometrack’s first UK Cities House Price Index.
The figures represent an increase of 0.1 per cent from August, while 14 of 20 cities recorded house price inflation below the rate of nine per cent.
London and Cambridge saw the highest levels of growth as house prices were up 18.1 per cent and 17.9 per cent respectively – equivalent to increases of more than £60,000 and £53,000.
Bristol, Oxford and Portsmouth also noted increases of more than ten per cent, showing areas where potential property investors may see high levels of capital accumulation.
Buy to let in university cities is increasing in popularity thanks to the levels of rental yields on offer, so further house price growth will only increase possible returns.
During the last year, the average UK house has seen its value boosted by £15,300, although some cities did note growth on a much smaller scale.
For example, Glasgow and Leicester saw prices increase by 4.3 per cent and 4.8 per cent respectively while Liverpool, Birmingham and Aberdeen saw an increase of 5.3 per cent.
It means Glasgow – which recorded the lowest increase of the 20 cities studied – saw a rise of just £4,500 to its average property prices.
“Local economies drive their local housing markets,” explained Richard Donnell, research director, Hometrack.
“Cities are the focus for employment and business growth, which in turn creates demand for housing. By focusing on cities, we can get a more accurate picture of the health of the housing market.”
The latest figures highlight the importance of researching investment opportunities in order to maximise potential returns.
Differing rates of annual growth across the UK provide an insight into the regions that are performing strongly – there is a close correlation between cities exhibiting strong property price growth and the rental yields on offer in those cities.
“Expectations that strong house price growth in the south of England would ripple out across the country were over-done,” added Mr Donnell.
To see more data on the most recent annual house price rise and its impact on the Buy to Let market please see our article about the ONS statistics.
27th October 2014