Widest Ever Price Gulf Between the North and South

By Rightmove, PRNE
Sunday, October 16, 2011

LONDON, October 17, 2011 -

The Rightmove House Price Index for October 2011 is released today and reveals that the average asking price for a property in the UK increased by 2.8%. The average asking price for a UK property now stands at £239,672.

However this figure masks a two-tier market in which the price gap between the north of the country and the south has never been wider. Asking prices in the south increased by 4.7% over the past month but fell 0.7% in the north. Average property prices in the south (£336,743) are now more than double those in the north (£164,347).

Rightmove director Miles Shipside comments: “While those in the affluent south may have cause to celebrate their prices being well up on this time last year, prices in the north continue to go backwards, leaving the widest price gap ever. For the average asking price of a property in the south you could now buy two average properties in the north and still have enough change left to buy new carpets and curtains.”

Compared to the beginning of the credit crunch four years ago, prices of new properties for sale have risen by 5.4% in the south but fallen by 9.6% in the north. In the last year, sellers coming to the market in the north have on average reduced their asking prices by 2.6%, while those in the south have felt able to put them up by 3.9%. Price decreases usually result when negative sentiment, influenced by uncertainty around employment and tightening of finances, rises. Of the seven UK regions with the highest unemployment levels six are in the north, so employment concerns, especially in the public sector, will be exerting downwards pressure on prices and activity in many northern areas. This will be exacerbated by lenders favouring buyers with higher deposits, where the less affluent north also fares poorly.

Shipside adds: “There is quite a simple formula to generate activity in the housing market, and access to finance through the ability to raise a substantial deposit and a secure job to fund repayments are the key variables. If prices are perceived to be rising then buyers are afraid that their dream home could move out of their reach unless they act quickly. These drivers of higher volumes of transactions and more buoyant conditions are more prevalent in the south.”

For further statistics and to download the Rightmove October 2011 House Price Index please visit - www.rightmove.co.uk/news/house-price-index or search for local house prices at www.rightmove.co.uk/house-prices.html

Contact details: Rightmove Press Office, press@rightmove.co.uk, +44(0)207-087-0700


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