House price growth "to overtake" prime London in 2015

HOUSE prices in Yorkshire are predicted to rise by 3.5% next year.

According to property consultants JLL, this figure falls just below of the 4% increase it beleves that Britain overall will experience.

Nonetheless, it would still mean that Yorkshire property prices overtake “prime central London” where an increase of just 1.5% is predicted.

JLL, which has an office in Leeds, predicts that the highest rates of growth in 2015 will be in Greater London and the South East – 5.5% and 5% respectively.

JLL forecasts growth of 4.5 per cent in Yorkshire in 2016 and total growth of 19.9 per cent over the next five years.

Leeds and higher value areas such as York and Harrogate are expected to outperform this regional rate.

The consultant says that rising employment, strong economic growth and schemes like Help to Buy have all strengthened demand for housing.

It believes the market is the strongest it has been in five years.

JLL’s head of residential in Leeds, Guy Ackernley, said: “Yorkshire, like much of the rest of Britain, has seen resurgence in demand and prices.

“Leeds in particular has been one of the country’s star performers and it will continue to do well.

“But we face a situation where a lack of supply is pushing up prices to a level where affordability and the ability to raise a deposit are once again becoming an issue, despite the valiant efforts of initiatives like Help to Buy.

“Addressing our long-term supply requirements is the real game-changer.

“This will mean tackling issues relating to planning, helping to release more land for development, and skills shortages within the construction sector itself.

“Fortunately, housing appears to be a big agenda item for each of the main political parties and so we’re hopeful that whoever wins the next election will be ready to turn words into action.”

JLL predicts the private rented sector will continue to be the most active housing tenure in the UK over the next five years.

In the short to medium term JLL is forecasting rental growth of 2-3 per cent per annum across the UK.

London is expected to see slightly stronger rental growth than the UK as a whole. 

This is principally because the capital will see a higher rate of job and population gains, but with the constraint that Londoners are prepared to move to save on housing costs.

Ackernley added: “Over the next five years we expect aggregate demand for rented properties to increase further. 

“A key driving force will be an improved economy and a rise in jobs. 
“However, rental growth is not expected to particularly aggressive since many renters have little capacity to pay more and many will endeavour to keep costs to a minimum in order to save to buy.”