Average House Price at All Time High due to Lack of Supply
The Average UK House Price has hit all time high and has crossed the psychological barrier of £200,000 for the first time. The previous recorded high of £199,600 which was recorded before the recession in 2007 has now been superseded and today the average cost of buying a home now stands at £200,280 and shows a average yearly price growth of almost 10%.
There are a number reasons for why we have now hit this new high. As mentioned in a previous post there is good sentiment about the economy since the Conservatives have remained in power. There are also many people benefitting from super low mortgage interest rates meaning that they can stretch the bank further when buying a new house, meaning people are now prepared to pay a higher amount.
A lack of Supply is the Reason why Prices have risen
The number one reason why property values keep rising is the lack of supply and this is proven by records showing the lowest amount of properties for sale since records began. A combination of house buyers being able to more easily attain a mortgage and benefit from low interest rates when they do, combined with a lack of choice of available property’s has put home sellers in a very strong position.
Some Areas still find it Difficult to Achieve a Quick Sale
Of course it is not the same story across the country. The Average House price in London is more towards the £400,000 mark and because of there being such a concentrated population the lack of property supply has really fuelled a fast moving market this can be seen when the national average has risen 18% since 2010 whereby in London house prices have risen 45%. For anyone wishing to sell their house quickly London is the place to be. For those who aren’t fortunate enough to live in the Capital it may be a completely different scenario. Worst hit are unpopulated rural areas even though there may be less houses coming to the market there is still a lack of property buyers and therefore they are not experiencing any price rises at all.
Interested Rates will Start Rising in 2016 Prediction
It’s Predicted that Interest rates will start rising from the start of 2016. It is inevitable that the government will have to put interest rates up at some point and many believe that it is now long overdue. However, it has been soo long that it may create a knee jerk reaction so analysts are predicting that prices will continue to rise until the end of 2015 but a quick slump in activity at the start of 2016 if the interest rate policy changes.
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