House prices in 20 UK cities analysed by Zoopla show an average 1.7 per cent increase over the 12 months to March - but the north is performing far more strongly than in the south.
The portal’s Hometrack division says the slowdown in London is now feeding out into cities across southern England with price changes ranging from a 0.6 per cent fall in Oxford to growth of 2.2 per cent in Bristol.
Sales in southern England are down 13 per cent since 2015 – the peak year for sales – primarily a result of affordability pressures and higher stamp duty costs in this part of the country. Zoopla says Brexit uncertainty has been a compounding factor, meaning households have been delaying decisions over home purchases.
Northern cities continue to defy this slowdown, however, and Liverpool leads the way with average house prices up 5.7 per cent annually to £122,100.
Leicester, Manchester and Glasgow are also registering house price growth in excess of 5.0 per cent per annum.
Liverpool and Glasgow have registered the highest increase in housing sales since 2015 of all the cities, with transactions up by 19 and 12 per cent respectively.
On average, property sales increased by 6.0 per cent across all cities in northern England in the last three years.
“The housing cycle continues to unfold at different speeds across UK cities. London has led the overall market along with Cambridge and Oxford” according to Richard Donnell, research and insight director at Zoopla.
“While sales in London are down 20 per cent on 2015 levels, prices are flat over the last 12 months. The signs of firmer pricing we recorded last month have continued into March with fewer London postcodes registering price falls. More realistic pricing and better value for money for potential buyers means sales volumes have stabilised” he continues.
“Cities across southern England are 18 to 24 months behind London. House prices have increased significantly ahead of earnings in recent years causing the rate of price growth to now slow due to weaker demand and lower sales volumes. Price growth is set to remain weak as affordability levels start to re-align with what buyers are prepared to spend.
“House prices and sales volumes continue to increase in regional cities outside southern England. Prices in these cities have recorded modest gains over the course of the last decade and affordability remains attractive. As employment levels and incomes rise, households have the confidence to bid up the cost of housing, with four cities registering price growth of 5.0 per cent or more per annum.”