London to lead housing market recovery
The London property market is expected to lead the way to recovery with 41% cumulative growth between now and 2016.
Expectations for growth in the property market are set to reach 6.6% next year, after growth over the year reached 2.65%.
French real estate agents, BNP Parabis, which has offices around the UK, carried out a survey into how the housing market would perform over the coming years.
Research found that in UK overall, the market would grow by 24% cumulatively between now and 2016, however falls of 1.1% are expected for the country as a whole this year.
Tim Cann, head of residential at BNP Parabis, said: “Activity in the UK housing market continues to remain sluggish, as values in South East (outside London) have been flat or have fallen in the last nine months, but since our summer report there have been some very early tentative signs of improving market conditions.
“At a regional level, London and the South East remain resilient and are the only markets where we are forecasting positive house price growth this year.
“England’s seven remaining regions are forecast to see negative house price growth in 2012, with five of these regions expected to see greater falls than those experienced in 2011.”
Outside London, the South West will fare the best with 34% growth in house prices in the next four years, with annual growth of 6%.
The Eastern regions will see 21% growth in this period, while the West Midlands will perform slightly better with 24% cumulative growth.
North East regions will see growth of 16% upto 2016, although falls of 1.1% are expected this year in line with the national average.
Debbie Taylor, head of land and new homes at BNP Parabis, said: “The UK remains separated by a very distinct North/South divide - the North remains constrained by there being greater costs on remediation and infrastructure against what is achievable in terms of sales revenue, due to the region’s industrial legacies.The South is more affected by the level of affordability of the stock than by availability.”
Mr Cann concluded: “With some very early tentative signs of some improvements in the housing market, our forecast for 2013 is more upbeat than 2012, with UK house prices forecast to grow 0.9%.
“Whilst this increase won’t offset the falling values experienced in 2011 and 2012, positive growth will certainly be a move in the right direction.
“Beyond 2014 we are expecting the UK growth rate to accelerate, with UK house prices forecast to rise 8.8% in 2015.”