House prices in Edinburgh, Glasgow, Southampton, Bristol and Birmingham have grown at a faster rate than those in London.
House price growth has increased in five cities around Britain at a faster rate than the capital’s cooling property market in recent months, new data from Hometrack reveals.
UK house prices have increased by 8.9% year-on-year but there has been a continued slowdown in the monthly rate of growth in recent months. The rate of house price growth in London slowed by two-thirds in the last quarter compared to the 12 month average (0.5% compared to 1.4%) with Edinburgh, Glasgow, Southampton, Bristol and Birmingham now all registering higher inflation than the capital in the last 3 months as demand for housing continues to push prices ahead.
The Scottish cities of Edinburgh (1.8%) and Glasgow (0.9%) registered the fastest house price inflation in the last quarter, as demand fed back into the market post-referendum. At the other end of the scale, the former high growth cities of Cambridge and Aberdeen have seen a rapid decrease with growth of only -0.2% and -0.4% respectively.
Richard Donnell, Research Director at Hometrack, said: “The high growth cities over the last year are now recording the fastest slowdown and this is most pronounced in smaller cities such as Cambridge and Aberdeen. The Aberdeen economy is closely related to the health of the oil industry and a weakening oil price is impacting the housing market. The slowdown in London, which we identified in, will act as a drag on the UK rate of house price growth over the next 12 months. The rate of growth in house prices is starting to lose momentum across other cities in southern England, while across the rest of the country modest levels of house price appreciation continue as prices rise off a low base.
“Overall we expect modest UK house price growth of 2% in 2015, which is more in line with earnings growth. Significant pent-up demand has feed back into the market in the last two years pushing house prices higher in all cities but the underlying rate of growth is now slowing across the majority of markets.”