Property prices in England continue to rise despite risks

Prices for property in the UK rose 0.6% in may, but there are signs that the pace of price growth has begun to slow down.

Quarterly prices rose 1.4% . It’s about the same rate as in November 2015. Thus, after a strong start to the year, the real estate market returned to its normal activity. Over the past two decades, property prices in London per 1 square meter increased by 432% , significantly ahead of the national average, which recorded a growth of 251% . Now the average price of a property in the UK is £213431.

And although the London real estate continues to dominate as the most expensive, there are a few places outside London where prices per square meter, significantly above the national average.

Low interest rates, employment growth and growth in real wages continues to support demand in the property market of the United Kingdom. This is good news that the price of property in England is still rising, despite the increase in rates of Stamp duty and the impending uncertainty in connection with the referendum. This means that market demand remains steady and surpasses supply. Most experts agree that due to the imbalance of supply and demand will remain a pressure on prices and after the referendum. After the April changes to Stamp duty, the balance of forces in the real estate market has changed in favor of the buyer in the sector of expensive housing. The sellers, knowing that buyers are willing to pay more , are more flexible and there is a decline in prices in the sector of luxury housing. In the sector of affordable housing trend is still set by the sellers, since the problem of supply shortages continued to pose a major problem in the market. It seems that the government plans to build 1 million affordable housing required by 2020 will not be realized . In such circumstances, the prices of property in the UK will remain a forward trend in the medium and long term.

® Maxim Savitsky G. 06.06.2016

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