30 Oct

House hunters look outside the capital for value

House hunters look outside the capital for value

More people are looking outside the capital to find affordable properties, according to new research from Rightmove.

The latest survey shows that prices in the South East are now rising faster than in London, with the region expected to see the largest rise in prices over the next five years. Over the past month, the price of properties have increased by 2.6 per cent as demand strengthens.

Rightmove is also predicting that prices in Southampton, Brighton and Luton will prove profitable as people look for alternatives to London, but are still within reasonable commuting distance.

"The ripple effect of buyers priced out of London combined with those cashing in and moving out of the capital means that the South East has taken London’s boom-town crown," said Miles Shipside, Rightmove director and housing market analyst.

He added that many property owners in the South East seem to want to delay putting their homes on the market because some feel it makes more financial sense to hold on to their investment, while others believe there is nothing that offers them an alternative at the present time.  

Meanwhile, Strutt & Parker are forecasting that property prices will continue to rise, with a predicted five per cent increase across the UK next year.

Stephanie McMahon, head of research at Strutt & Parker, explained some estate agents are seeing a slowdown in areas at present because of the upcoming general election but prices are expected to remain firm.

She added: "As is often the case in uncertain times, it may also be that transaction levels will decrease in the run up to May 2015, but values could hold up better than expected."

The latest figures from the Council of Mortgage Lenders (CML) show that last month's mortgage lending reached £17.8 billion - one per cent lower than in August, but ten per cent higher than the same point last year.

CML chief economist Bob Pannell said: "Uncertainty over when we will see the first increase in UK base rates is exacerbated by weaker growth prospects in several major economies, including the eurozone.

"Recent indicators and policy actions corroborate our view of a gentle easing in market conditions. There is growing evidence that mortgage lending activity, and the housing market, are sitting on a plateau."ADNFCR-1222-ID-801757055-ADNFCR

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