By Newly published data from the Nationwide House Price Index has found that house prices fell by 0.8% month-on-month from February, their seventh consecutive monthly fall.
With the overall fall in property prices, a stronger North/South divide in market activity has emerged.
Southern England experienced a 1.1% decline, unlike the West Midlands, the strongest performing region, experiencing a 1.4% increase in the first quarter year-on-year to March this year.
The proposals to ‘supercharge’ the Northern regions with £80 million of funding over five years will aim to improve skills and local infrastructure clustered around universities or research institutions.
In turn, this will aid sectors such as technology, artificial intelligence, and the creative industries, which have traditionally operated in London.
There are 188,812 tech firms with payrolls across the UK, with 44,831 of those residing in the capital.
However, the new proposals and the increasing rent costs by 9.1% for properties in London are expected to prove too prohibitive for workers to stay, pushing them further North to escape the increasing cost of living.
It is no surprise that renters and homeowners are fleeing from the South, especially with many choosing to move further North due to the overwhelmingly cheaper cost of housing.
As of March 2023, the Office of National Statistics (ONS) reported that the North East still has the lowest average house prices in the UK at £163,000, while London has the highest at £534,000.
The recent report from the government on Stamp Duty Land Tax statistics for the 2021/22 financial year found that the UK experienced a rise in non-residential receipts, ranging from a 32% rise in the East Midlands (from £200 million to £265 million) to a massive 80% rise in the North East (from £50 million to £90 million).
More than a third (38%) of tenants from London moved to the Midlands or North, up from 27% in 2019 and above the 13% of homeowners moving to the same regions.
David Hannah, Group Chairman of Cornerstone Tax provides some expert insight on what the twelve new investment zones will mean for the Northern property market:
“The announcement from the Chancellor of 12 new investment zones spread across the West Midlands, Greater Manchester, the North East, South & West Yorkshire, East Midlands, Teeside and Liverpool is already likely a factor which is keeping property prices buoyant in these regions.
There has been a concerted effort from the government to spread the wealth evenly throughout the UK and the introduction of these investment zones should increase the amount of jobs and businesses in these regions which will inevitably effect property prices.
Not to mention providing more job opportunities for those who are currently unemployed causing a rise in wages and potential property buyers.
The chancellor did outline employment as a priority in the announcement and specifically a measure of having apprenticeships available in the skilled trades for over 50-year-olds.
Naturally, this could positively affect the chronic undersupply of properties in the housing market if we have more skilled workers that are able to work in the construction sector.
This is a good measure that helps address skills shortages, which are currently affecting 83% of businesses within the construction industry, according to research by recruitment specialist Search Consultancy.
I think anything that they can do to expand the construction sector is welcomed – it is a supply crisis that we are seeing in the property market, not a demand crisis.
They are focusing on getting workers to return back to work and that should inevitably speed up construction.”
Comments