It’s official: the UK property hotspot of 2018 is the town on Ryde, on the Isle of Wight, where house prices have gone up by over 10%.
According to property website Zoopla, Ryde was the town where average property values rose the most. The average house costs £242,016, and the 10.24% rise added £22,500 to the cost of buying one. Zoopla figures showed that the value of the average UK home increased by a much lower £2,860.
Next to Ryde, the biggest property value rises occurred in Smethwick, near Birmingham, where property prices increased by 9.67% to an average of £163,627, and Diss, in Norfolk, where homes were up 7.89%.
Overall, house price inflation in the UK has subsided in 2018, making it the first year in which the cost of buying a home has not exceeded wages since 2012.
Zoopla indicated that property value rises averaged 1.02%, but there were variations across the UK. Property values in Scotland rose by 6.43% and by 3.98% in Wales. In England, the rise was a marginal 0.58%.
Zoopla said that the property value rises had come during fears over Brexit, which is affecting London and the commuter belt in particular. Buyers in London and the South East are also struggling to afford homes with near-record high prices.
Richard Donnell, Zoopla insight director, said that property values in London have gone up significantly since 2010 but tax changes and affordability issues are causing values to fall back. In contrast, properties remain affordable in areas outside of southern England, and on the back of lower mortgage rates and rising employment, values are outperforming the rest of the UK, a trend that is expected to continue.
Difficult times have been forecast for the property market since 2019, with would-be buyers concerned about the ramifications of Brexit on property prices and the national economy. Another concern is the high cost of buying a home.
Some have suggested that if a Brexit deal is made, a bounce may occur, making this winter a good time to buy for those seeking to negotiate prices.
Halifax, the UK’s largest mortgage lender, forecast property values to rise between 2 and 4% in 2019.
Halifax managing director Russell Galley said that looking ahead, the biggest challenge for the UK housing market in 2019 will be the extent to which mortgage affordability changes.
He pointed out that average income growth is likely to increase but with an additional increase in interest rates, property prices are not likely to be affected significantly. Despite the present political upheaval, annual house prices are expected to grow anywhere between 2% and 4% in 2019.
This rate of growth is slightly stronger than 2018, but still moderate by today’s comparison. However, uncertainty over Brexit means that both sides of the forecast carry a degree of risk.