You've probably heard that towards the end of 2019 the UK house market was struggling. Buyer demand had dropped, there were the lowest number of new homes entering the market in years, and house price increases were slowing to a stop.
Now we're past the general election, and Brexit, the UK housing market can finally look towards the future. It's got off to a good start; Zoopla have released new numbers showing how house prices in UK cities have reached +3.9%, the highest in 2 years.
Buyer Demand Shoots Up
It's a usual occurence that in a New Year, buyers come back to the market after the slump over Christmas. Christmas sees a drop in interest as people are focusing on holidays, family, and relaxing. No-one wants the upheaval of a house move over Christmas. However this has been 26% higher than the previous year. Every UK city had an increase in demand from buyers in the New Year, with just Belfast as an anomaly.
The areas with the largest demand in 2020 so far are the Midlands and the north of England. Sheffield, Leeds and Leicester are showing up to 20% higher buyer demand than average.
Research and Insight Director at Zoopla, Richard Donnell, said "Whilst the first few weeks of the year always see a return of home buyers to the housing market, demand for housing at the start of 2020 is 26% higher than over the last two years. This is partially due to fading political uncertainty; households who were holding off moving are now starting to return to the market and this momentum has been supported by low mortgage rates. The cities with more affordable house prices, such as Sheffield and Leeds, have seen the greatest increase in buyer demand as house hunters continue to focus on value for money this year."
UK Cities Growing Fastest
Zoopla has ranked cities most likely to see largest house price increases throughout 2020. They based this on factors including affordability and the time taken to sell.
Cities outside of the south of England came top as they are cheaper, so scored higher for affordability.
Coming top is Nottingham. At the moment, house prices are sitting at a 5.2% increase. Edinburgh and Glasgow are 2nd and 3rd.
Southampton, Oxford and London, all in the south of England, are thought to experience below average house price inflation. Affordability is difficult here as homes are more expensive. London came 16th, where sales are expected to increase rather than property prices because buyer confidence is expected to boost sales volumes faster than prices.
Richard said "Regional cities continue to lead the way for house price inflation this year thanks to continued economic growth and more attractive affordability of housing. The best prospects for house price growth in 2020 are in Nottingham, Edinburgh, Glasgow and Manchester.
"In contrast, we expect cities in southern England to register below-average price growth as affordability levels realign to what buyers can afford. Overall, we are expecting house prices to grow on average by +3% across all UK Cities in 2020."