Do you live in a star, a stag, a leader or lag­ger?

The Daily Telegraph - Property - - House Prices Special -

Is­abelle Fraser analy­ses where prices have surged and ar­eas which have been left be­hind for the last 20 years

We are in a unique hous­ing mar­ket: never be­fore has the ac­cel­er­a­tion of house prices at the top of the scale left so many so far be­hind. Prices in Hack­ney, east Lon­don, for ex­am­ple, have in­creased by a stag­ger­ing 939 per cent be­tween 1995 and 2015. Com­pare that to Black­pool, where that num­ber is 100 per cent.

Lu­cian Cook, di­rec­tor of res­i­den­tial re­search at Sav­ills, says this is un­prece­dented. “Some of these lead­ing mar­kets in Lon­don are pulling away far more than they have ever done be­fore, and the rip­ple ef­fect has taken much longer to gain strength. That means there is a big price gap be­tween Lon­don and the mar­kets farther afield, which have his­tor­i­cally moved closely in line with the cap­i­tal.”

This is the first time that Sav­ills has car­ried out re­search on the past 20 years of the hous­ing mar­ket in such ge­o­graph­i­cal de­tail. It iden­ti­fies which ar­eas are star per­form­ers, lead­ing the mar­ket, lag­ging be­hind, or stag­nat­ing. It also il­lus­trates just how di­verse the prop­erty mar­ket re­ally is.

A hous­ing cy­cle can be de­fined as one that starts with price rises and ends with the last ar­eas see­ing a slow­down or down­turn. The stars of the hous­ing mar­ket have con­sis­tently per­formed strongly in the past 20 years, ir­re­spec­tive of the point in the cy­cle; lead­ers showed the strong­est growth in the first half of the cy­cle, bounced back quickly af­ter the 2007-08 down­turn, and brought sim­i­lar mar­kets with them as the rip­ple ef­fect spread.

Lag­ging mar­kets, typ­i­cally in the North, the Mid­lands and Wales, have been slower to re­act, and so see price growth later in the cy­cle, as long as the un­der­ly­ing eco­nomic con­di­tions are right. Stag­nant ones have barely re­acted at all in 20 years.

Will these lag­ging mar­kets catch up? “It re­ally de­pends on what the eco­nomic con­di­tions are like when they nor­mally reach that part of the cy­cle, such as in­ter­est rates and mort­gage restric­tions,” says Cook.

Shin­ing: a Grade II listed house in Bit­ton, be­tween Bris­tol and Bath, is on the mar­ket for £1.95 mil­lion with Sav­ills, above; Steve and Ali­son Vin­ning, who are sell­ing their home in Clifton, Bris­tol for £675,000 with Chap­pell & Matthews, right

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