Despite a slowdown in the UK housing market in the final quarter of 2012, residential property prices still ended the year up 3.4%.
This was due to strong growth in the opening six months of the year, according to Assetz House Price Watch, an analysis of house price data from ONS, LSL Acadametrics, Halifax, Nationwide and Rightmove, which claims to give a comprehensive overview of the UK property market.
The data, which Assetz claim offers a more accurate picture of house price trends, shows that the average price of a home is now £202,824, an increase of £6,634 since December 2011.
The annualised average rate of growth for December was -8.6% while the three, six and 12 month annualised rates of growth are -1.4%, -3.4% and 3.4% respectively.
Stuart Law, chief executive of Assetz, said: “In spite of some downbeat forecasts, 2012 saw the strongest calendar price growth for three years, comfortably achieving our predicted 3%. Following a healthy first six months, there was an inevitable price correction in the second half.
“The UK housing market in 2012 was buoyed by an influx of buy-to-let investors from home and abroad which has increased competition for the best properties in areas where there is strong employment prospects, transport connections and amenities. For this reason, the market remains two tiered with London and the commuter heartlands of the South East and regional cities such as Manchester, Leeds and Liverpool seeing stronger prices rises than elsewhere in the UK.”
With the base rate set to enter a fifth year at its historic low of 0.5%, Mr Law believes that more people will divert capital from low interest savings accounts to high yield property investments. This coupled with the greater availability of mortgage finance as part of the Funding for Lending Scheme (FLS) will support growth.
He added: “We are confident of price growth of as much as 5% this year which would leave prices just shy of the 2007 peak in nominal terms and their highest since February 2008. The property market is well advanced on its slow road to recovery.”Source: www.propertyinvestortoday.co.uk