North East house prices fall 0.1% in March
• Prices fall 0.1% over past four weeks – £307 in cash terms. Prices also unchanged year-on-year. • Blyth, Washington, Gateshead and Morpeth perform best over past month • Easington and Peterlee perform poorest. • Rents fall 2.2% to 576 – but are 6% up year-on-year. • Rental yields in region remain 25% higher than London
North East house prices stayed in a state of suspended animation in March – remaining all-but-unchanged for the second consecutive month.
Research from KIS Group shows average regional property values are a little over 0.1% down over the past four weeks, with prices also practically identical to twelve months ago – 0.07% lower than March 2016, a cash difference of just £124
Across the region, prices are almost identical to four weeks ago – falling by 0.1% or £307 in cash terms. This compares with to a rise of 0.1% in February, and a fall of 3.1% in January.
A typical North East home will currently cost you £163,467 – compared to £163,591 at the end of March 2016.
There was more volatility from area to area with noticeable price rises in Blyth (2.9%), Washington (1.3%) and Gateshead and Morpeth (1%).
13 of the 20 areas surveyed saw prices fall – in particular Easington (-2.6%) Whitley Bay (-1.7%) and North Shields (-1.2%)
Properties in Darlington have performed strongest over the past twelve months, and are currently 2% higher than those recorded in March 2016. Prices in Easington (-3.6%) and Peterlee (-3.2%) have fallen the most over the past 12 months.
North East rents fell slightly to £576 in March – a drop of 2.2%, or £13 in cash terms.
Rental yields remain unchanged same – with property investors continuing to get an average return on their investment of 4.3%.
This means investors in North East property continue to see returns on their investment 25% higher than London (average yield 3.2%) and almost double those in Cambridge (2.3%).
Easington (£351) remains the cheapest place to rent in the North East out of the areas surveyed, followed by Blyth (£405). Tynemouth (£892pcm) this month’s most expensive in general terms.
Peterlee is the region’s Buy to Let Capital yet again, with an average return of 6% for investors. Other strong performers for rental yield include Newcastle (5.6%) Gateshead (5.2%) and Seaham (5.1%).
Yields in Newcastle are above those in Gateshead for the second time on record, the first occasion occurring in January.
Ajay Jagota, founder and Managing Director of Keep It Simple and Dlighted a Proptech company that delivers a Deposit replacement insurance solution which is an alternative to the cash Tenancy Deposit schemes TDS, DPS and Mydeposits.
“Last month I attributed frozen North East house prices to buyers and sellers alike adopting a wait-and-see approach in the run up to the triggering of Article 50 – and I see no reason to revise that opinion this month.
“With Theresa May taking that step this very week, it will be fascinating to see if we see more profound movement one way of the other in the weeks ahead.
“Some analysts have noted a growing North-South divide returning to the UK property market, with the North East lagging behind the rest of the country. These results, with prices falling as a whole and falling much more conspicuously in places like Peterlee and Easington do nothing to disprove that theory.
“But this doesn’t have to be gloomy news. What’s really positive for property in our region is quite how resilient and robust North East house prices have remained in the face of so much uncertainty and upheaval over the past 12 months, changing by little over £100.
“Home ownership amongst the under 30’s has fallen from 59% to 37% in just 10 years, and the Council of Mortgage lenders this week predicted it will continue to fall to 25% by 2020. Research from Lloyds Bank recently placed both Durham and Sunderland in the top 10 affordable cities in the UK, and the former is one of the most expensive places to buy a house in the North East.
“Whatever lies ahead for the British economy, the North East remains well-placed to retain and attract skilled workers and new businesses, to whom affordable housing it critical.”
This was posted in Bdaily's Members' News section by Ajay Jagota .
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