Residential property values in Manchester have risen 5.1% year-on-year in the last 12 months, according to new data from Zoopla. Liverpool saw the biggest prices increases in the average home (5.7%), followed by Leicester (5.3%) and Manchester. This compares with a nationwide average of 1.7% growth in the last year, which is the lowest annual price increase in the last seven years.
The slowing national price increase is being blamed on the rising costs of moving home and a lack of affordability among millennials. Some regions in the south of England are even experiencing average declines in house prices, with Oxford recording a fall of 0.6% year-on-year. Brexit remains very much the elephant in the room when it comes to the UK housing market, with an ever-growing question mark of whether Brexit will ever come to fruition helping to compound the issue.
Although property values in the North West have risen substantially higher than in the south, due largely to improving employment rates and a higher stock of entry-level properties, these values are increasing from a much lower base than southern regions. In fact, the North West of England is only now beginning to see property values return to levels seen before the 2008 credit crunch.
For further proof that the North West is becoming the place to get great-value entry-level properties, you only have to look at 28-year-old Theo Fashesin. Theo, a marketing professional from London, was featured in The Sun for saving £17,000 in a year to put down a 10% deposit on a three-bed terrace property in Manchester valued at £130,000. According to Zoopla, the same-sized property bought in London would have cost in the region of £708,000.
Theo managed to save £1,000 a month to build up enough of a deposit so that mortgage lenders would consider her mortgage application based solely on her income. Lenders are slowly starting to increase the maximum a sole applicant can borrow in line with their pre-tax income. According to Trussle’s info on the Nationwide mortgage application process, the building society now lends up to 4.75 times a sole applicant’s income before tax, depending on their unique circumstances.
Manchester also featured heavily in a recent report by PropCast, which put a microscope on the postcodes in England and Wales that are particularly “hot” for sellers. The organisation measured the total number of properties for sale in England and Wales before calculating the percentage of which are under offer or subject to contract (STC) to get a feel for the “temperature” of the regional markets.
Bristol’s BS3 postcode registered the “hottest” temperature at 65, followed by three leading postcodes in Manchester – M24 (64), M32 (64) and M6 (62). At the other end of the spectrum, PropCast provided further proof that London’s property market is plateauing at best. NW8 in Westminster and Camden is ranked as the “coldest” postcode, registering a temperature of only eight. This is followed by WC2 (9), SW8 (10, EC2 (10), W1 (10) and SW7 (11). Gavin Brazg, founder of PropCast, said: “Anything above 50 is considered a very hot sellers’ market, so Bristol and Manchester are on fire at the moment.”