South Leads ‘Mini-Boom’

Asking prices have increased thanks to a mini-boom in the south of England, says Rightmove. Meanwhile the north-south divide is widening with an average property in the south now 55 per cent more expensive than it would be in the north of England, and Rightmove believes the situation will be enhanced if interests rate go up.

Rightmove?s housing market survey for June revealed that national asking prices rose again last month, bringing the annual growth rate from 5.9% to 6%. ?This is in line with our revised 2006 forecast announced last month,? said a spokesperson for Rightmove.

But the price growth, which Rightmove dubs ?a mini-boom?, is being led by the southern parts of the country. ?Falls in many of the northern regions of England have now changed a southern-led boom, to effectively a southern-only boom,? Rightmove confirmed.

Figures show that that gap between house prices in northern and southern England is widening ? the southern regions are now over 55 per cent more expensive than the north, an increase of 9% since September 2005. A wealth of cash buyers and a shortage of suitable top end properties have fuelled the situation, according to Rightmove. ?The buoyancy of the southern economy and demand for quality property by affluent buyers are having the effect of increasing homeowners? net worth even further,? said Miles Shipside, Commercial Director of Rightmove, ?Parts of the north are now being left behind as stretched affordability has limited sellers? ability to increase prices in most regions.?

But according to Rightmove, the northern market is still healthy, despite the slowing price growth. However a rise in interest rates would further increase the north ? south price divide. ?Demand and transaction levels are still healthy in the north despite the slowdown in prices. Any upward movement in interest rates could but this in jeopardy at a time of year when the market normally slows down,? Mr Shipside explained.

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