North South Divide Set To Widen
The North-South divide in British house prices is set to widen sharply this year and next, according to a recent study by the Centre for Economics and Business Research (Cebr).
London house prices are set to grow 2.4% in 2012, while properties in the North-East will see values plummet by 2.7%, as the capital remains relatively unharmed by the wider geographical impact of the double-dip recession.
A new study by the think tank shows that homeowners in Yorkshire & the Humber, Wales, the North-West, Scotland and the North-East will see the values of their properties fall in each of the next two years. By contrast, London and the South East will grow by at least 2% in both 2012 and 2013.
London is further protected because it remains a safe haven for wealthy overseas investors. But this does little to protect other areas of the UK where demand from overseas investors is very little. Even low interest rates and a lack of housing supply have failed to prevent property slumps in other regions. The UK average house price change is expected to be an increase of just 1%– an improvement on last year’s 1.5% fall, but way down on the 2007 pre-crash boom of 11%.
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