90% of North East homes worth more than this time last year - with Tynemouth property values up £10,000
• Average house prices in the region up 1.9% down over the past four weeks – cutting over £3000 from the value of the average home • Year-on-year average rise in value of North East homes however is 1.1% (almost £2000 in cash terms) with 90% of properties worth more than 12 months ago. • Prices fall in all 20 areas surveyed, but performing strongest in Tynemouth and Houghton-le-Spring both monthly and annually. Tynemouth homes now worth almost £10,000 more than this time last year. • Average North East tenancy deposit currently £873. • North East rents fall slightly to £598pcm, typical returns for investors currently 4.2%
Figures from sales and lettings firm KIS and deposit free renting firm Dlighted show North East house prices continuing to grow year-on-year - despite prices falling back over the past four weeks.
Average house prices in the North East appear to have fallen by 1.9% over the course of February 2018, removing £3160 to the value of the average home.
Prices previously rose by 0.8% in January.
An average property in the region was valued at £165,682 at the end of February 2018 – 1.1% higher than the £163,794 recorded at the same point in 2017, a jump of £1889 in cash terms.
The research shows prices falling in every one of the 20 areas surveyed, but falling the least in Tynemouth (-0.09%) and Houghton-le-Spring (-0.2%)
Monthly prices fell furthest in Jarrow (-4.2%) and Whitley Bay, Durham City and Cramlington (all -3.1%)
House prices in Tynemouth and Hougton-le-Spring have also performed strongest in percentage terms over the past 12 months, recording rises of 3.1% and 3% respectively.
Homes in Tynemouth and Washignton have also performed strongly in cash terms, with property values up £9013 and £4981 respectively. Prices are up annually in 90% of the areas surveyed, but have fallen in Cramlington and South Shields (-1.2%)
Renters in the region are slightly better off than they were four weeks ago, with average rents falling from £591 to £582 – saving tenants £108 a year. Easington is currently the cheapest place to rent in the North East, with average rents of £386 practically half those found in Morpeth (£839) – this month’s most expensive.
The North East continues to offer investors average rental yields of 4.2% - with landlords in Peterlee (6%) Newcastle (5.5%) and Gateshead (5.1%) seeing the best returns.
Under this month’s figures, the average tenancy deposit under the six week tenancy deposit cap proposed by the draft Tenant’s Fees Bill would see North East renters facing move in fees of at least £873 – rising to £1418 in Newcastle and £1041 in Durham City.
Ajay Jagota, Managing Director of KIS Group and Founder of Deposit-free renting firm Dlighted responded to the figures.
“North East house prices are continuing to maintain a steady pattern of month to month volatility, but sustainable annual growth, which is a perfectly desirable position.
“Annual appreciation in value is the key data to keep an eye on, and these figures show that if you live in say North Shields, your house may have lost 0.3% of its value this month, but it’s still worth £3000 more than it was last year.
“As for possible reasons for this month’s fall, you need only to look out of the window. People aren’t exactly likely to be viewing new houses when the weather makes it impossible for them to leave their current ones!
“Rents continue to remain the same, as they have for some time, but opportunities for property investors are increasingly. The recently published English showed a ‘particularly pronounced’ drop in home ownership among the young, with the percentage of under 35-year olds privately renting rising from 27% to 46% over the past decade.
“85% of tenants surveyed reported choosing a rented property because it offered deposit free renting. From an agent or landlord’s perspective asking for a deposit means limiting potential renters to those with at least £873 to hand.
“Switching to deposit replacement insurance on the other hand practically eliminates moving in for customers allowing owners and agents to let properties faster, cut administrative costs and protect themselves better against unpaid rent, legal fees and property damage.”
KIS Group were named Letting Agent of the Year in 2013 after becoming the first property firm in the UK to abolish the tenancy deposit –replacing them with deposit replacement insurance.
Dlighted’s low cost deposit replacement insurance lowers the cost of renting for tenants while giving landlords the peace of mind of £600,000 of protection against property damage, £75,000 of cover for unpaid rent, and £50,000 of legal protection.
Dlighted is a deposit free renting alternative to a tenancy deposit scheme such as mydeposits, the Tenancy Deposit Service and the Deposit Protection scheme and deposit-free renting with Dlighted has been cited by 85% renters as their reason for choosing a particular letting agency.