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News - 2 May 2012

The North South House Divide

For First Time Buyers recent times have been difficult as Mortgage lenders have been far more resistant to offering anything like the High-Value/Small Deposit mortgages of even 5 years ago.

Prices do vary. A recent survey puts average house prices in Greater London at £464,994 the South-East at £316,245, and the South-West at £270,735.

The area of North Yorkshire/North Lancashire to the Borders come out at the least value at £151,891 and Yorkshire and Humberside at £ 156,672 as the second lowest – half the price of London and the South-East.

To add further to the difference, house prices in the south have continued to increase: Greater London prices are now 16% higher than the pre-crash peak of May 2008, with the South-West by 2%.

Conversely, the Yorkshire and Humberside region has fallen by an average of 9% and the North Yorkshire/North Lancashire to the Borders area by 4%.

Why is this? A combination of slower recovery and lack of demand in the house market, fuelled, some say, by the disproportionate impact of public austerity on northern regions. This is also shown in the figures that mortgage borrowers in the north are 30% more likely to be in arrears and negative equity.

Rent or Buy

Research from Zoopla shows that a gulf in buy-to-let profits has opened up. Liverpool, Hull and Oldham emerge as the areas with the highest rental returns, while Cambridge, York and Reading come out with the lowest. Again, this is down to the greater exposure of these areas to austerity.

Lavinia Newman, Founder of ABDS says:
“It is not just the differences in house prices, market stability, negative equity and rental that are the problems. The difference exists due to more serious social and economic reasons such as job creation and stability.”

Director of Rightmove, Miles Shipside endorsed this
"The richest seams of housing market activity are concentrated around those with access to cash and finance, with a strong bias to the South and London in particular."

If you need any help and advice on the implications of Property Ownership, Letting and Taxation, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar to discuss how ABDS can help.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

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