The latest figures from Hometrack show that the inflation rate across the nation’s cities sits at 5.2%. Although London has taken a hit slowing down to 1% growth, five regional cities have enjoyed an annual price inflation of over 7%.
Edinburgh tops the list with an 8% inflation growth year on year, up from 4.4% last year. It is closely followed by Liverpool (7.8%), Birmingham (7.7%), Leicester (7.7%) and Manchester (7.1%).
Birmingham, Leicester and Manchester were all slightly under 7% growth last year and this year are all above the 7% mark.Both Edinburgh and Liverpool had middle of the pack growth rates last year, but this year have the highest increases in inflation across UK cities.
The average growth across all 20 cities sits at 4.1%, while the UK’s average as a whole is 4.3%.
London has unfortunately suffered the lowest annual rate growth since August 2011 at 1%, down from 4.3% last year and 42% of postcodes have dropped year on year. However, the capital is not alone in the drop, Southampton fell from 5.2% growth to 2.8% and Bristol from 7.7% to 4.1% this year.
Aberdeen and Cambridge have recorded growth rates below zero: (-7.7%) and (-1.5%), respectively.
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The appeal of city living continues to ensure that house price growth across the nation’s major cities remains buoyant, despite wider market conditions. This imbalance of supply to meet demand in the more densely populated areas of the market has seen them buck the trend of a slower start to the year, to enjoy a greater rate of annual growth than this time last year.
Unfortunately for the capital the much higher price of getting on the ladder, and the greater degree of buyer uncertainty as a result, has seen London remain one of the ugly ducklings of city living where market performance is concerned.
However, as we’ve seen over the years, the popularity of the London market is cyclical and while it may have fallen out of favour for the time being, this cool in price growth is unlikely to prevail as the year plays out and it is highly unlikely we will see a market crash of any shape or form.
London is still viewed by many as the pinnacle of homeownership in the UK and while the growing political tensions with Russia will do little to help London’s prime central market, vast pockets of the capital remain very popular among buyers.