With an abundance of data released on a monthly basis regarding house prices and property market trends, it is of no surprise that many prospective purchasers are slightly bemused when being inundated with varying information.
With Land Registry data released this morning highlighting particular regions that have exceeded London’s house price growth rate, we question the ever-competitive property market. So what trends are we seeing from this data?
In simplest terms, the majority of regions seeing the highest rates of annual house price growth are those within an hour of London. Align this with the Crossrail plans that will extend London commuting to parts of Essex and Reading, and you’ll begin to understand the driving forces behind the area’s rapid price increases.
Two particularly noteworthy locations are Essex and Hertfordshire outperforming most other areas/regions – including London. With Essex at a significant annual price rise of 8.8% and Hertfordshire even higher at 10.7%, there must be further factors affecting the growth rather than just a competitive market for premium homes. Bordering London, both Essex and Hertfordshire offer excellent commutes into London and the city/financial district in particular already. However with the Crossrail stations opening in Brentwood and Shenfield in 2019, commute times to the West End and Heathrow will reduce significantly and the areas will have to accommodate for a higher capacity of commute-focused property owners, the benefit of which will be felt further into Essex.
Hertfordshire’s idyllic countryside, twinned with available and substantial family homes with a close proximity to the capital city, account for some justification of the rate increases. As more and more Londoners decide to balance their work-life and home-life priorities equally, the need for space and a peaceful environment is not something necessarily found easily in the city. Alongside the impending improvements and existing beauty of each country, another price driver is the average house prices of the aforementioned counties compared with other counties surrounding London, such as Surrey and Buckinghamshire.
Despite the rising costs of homes in Essex and Hertfordshire, their average property values still come in at £221,487 and £303,480 respectively, compared with he likes of Surrey at £371,191. Surrey and Buckinghamshire are mature commuter areas with established commuter towns already. However, they do not offer quite the same value for money as Herts and Essex currently and with market conditions as they are, buyers are increasingly concerned about value.
Interestingly, another location that is worth noting on current market performance, with similar driving factors to Essex and Hertfordshire, is Reading. As a location to similarly benefit from the Crossrail development, the area has seen an influx of both investors and home buyers in recent months. Demand in the area is set to increase, with many trying to utilise the currently not-as-expensive prices in Reading town, as the surrounding areas maintain higher house prices.
With the commuter-link and value for money priorities far reaching to new locations, it is of no surprise that London-vicinity property markets are under strain to supply for the ever-increasing demand.