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Property Sale Price Increase of 12% for 2009
February 22, 2010Article by Ray Withers
The UK market saw a 12% increase in property prices during 2009. This is especially impressive if one considers the downturn of 2008 when the sale price dropped an average of 20%. The year also ended with competitive pressure amongst buyers and investors as more than 8 applicants registered for each new instruction that entered the market. This is up 48% on 2007’s figures when the ratio was less than 6-to1.
Hamptons International’s latest price tracker figures correlate with this steady incline of growth within the property market with an increase of 3.5% in Q4.
The strongest quarter of 2009 was Q3 with an overall 5.3% gain. This pace of increasing prices slowed in the final quarter of the year. Essentially this positive pricing pattern is being driven by the absence of premier stock in areas of desirability. This is further demonstrated by the year-on-year 17% decline in the instruction levels for 2009. However, buyers were extremely visible in the market as the actual number of sales increased by 39%.
In terms of the desirable areas for London commuters, Maidenhead has the most expensive average property price of £275K, closely followed by Oxford and Tunbridge Wells. Brighton’s average sized property is £260K. Surrey Towns such as Liphook, Alton and Fleet cost an average price of £205 – £218K for a property.
Another factor which has further illuminated the property market is the volume of completions in 2009. This was up nearly 50% on the previous 12 months. It demonstrates that the buyers and sellers in the market are more confident and dedicated to the offers they make. This is a shift from many of the transient operators in the market during 2006 and 2007.
With this marked increase in sales and completions, prospective sellers now have access to data and can price their property accordingly when first entering the market. Once again, we can justify the case that buyers are more confident to make an offer as the fall-through numbers fell by over a fifth. This is all the more powerful if one considers the increase in the properties for sale volume.
Rental property has also seen positive changes. Hamptons International reported a rise of 1% in rental prices for Q4. This is their second strongest quarterly rise since late 2007.
Nationally, throughout 2009, lettings properties have been slowly gaining in value with Q4 showing the strongest gain of the year. This has meant that the average rental value finished the year almost equal (0.9%) to the value 12 months earlier. This is quite a feat when one considers the reductions of 2008 and early 2009. In summary, the sales price increase of 12% and the strongest rental growth for two years indicate the gradual recovery of the UK property market.
According to research by Hamptons International.
Written by: Christopher Chadd