UK property market loses momentum as price growth slows down
Edinburgh and Glasgow recorded the fastest price increases in the UK property markets over the last three months.
According to data released by property firm Hometrack, prices in other areas of the UK showed that the boom that had characterised the first six months of the year was losing momentum, with prices in Aberdeen and Cambridge falling in the period.
According to the latest City House Price Index, which is based on Land Registry data for sales for 20 cities, representing 40% of the UK’s housing stock by value, prices across the country rose 8.9% over the past 12 months, though November saw only a 0.4% increase to an average of £185,000.
Prices in Edinburgh and Glasgow rose 1.08% and 0.9% respectively, as the market saw demand increase in the wake of September’s referendum vote against independence.
However, in Aberdeen, prices fell 0.4% over the three months, the steepest decline of any of the cities in the study as and analysts believe decline could be related to the decline in crude prices, given the city’s role as one of the main hubs for oil workers.
“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,” said Hometrack’s research director, Richard Donnell.
“The Aberdeen economy is closely related to the health of the oil industry and a weakening oil price is impacting the housing market.”
Prices in Cambridge fell 0.2% over the quarter but rose 13.4% annually to £338,500, while prices in Liverpool declined by 0.2% and by just over 3% to an average of £107,000.
Meanwhile, the largest annual rise was registered in London, where the average price of a home rose 16.4% to £403,200, though the recent slowdown in the capital was likely to act “as a drag on the UK rate of house price growth over the next 12 months”, Donnell said.
As a result Hometrack is predicting prices to increase by just 2% in 2015.