The UK’s property market has been on a bull run for the last few years. It has transformed from a doldrum of economic ruin to an engine of the UK’s economy.
There have been reports as recently as the first week of September that the market was beginning to cool off. This would have been welcome news to the many people who now find themselves priced out of the market, even if they have secured a fixed rate mortgage at historic lows.
However, a report from the Land Registry has cast doubt on the notion that prices were beginning to plateau. In fact, according to their figures, prices actually accelerated and were up by 1% in comparison with July.
It’s not an even playing field. London, as expected, remains the driving force behind the increases. Outside the M25, things are different. Demand for property remains high, but prices have been fluctuating. Whereas London’s market continues to boom, prices in places such as Maidenhead and South Yorkshire have actually fallen.
Is there a price ceiling?
The fact that London’s market is so strong is no surprise considering the job and lifestyle opportunities the capital affords. But, for how long can this trend continue?
Gazumping has returned. It is no uncommon for hundreds of people to attend a single property viewing. Competition is fierce. It shows no immediate sign of abating. And when garages sell for £550,000, you know you’re in a bubble.
That is a worry for some. Apart from changing the demographics of whole areas, the property boom is forcing more to rent. But rents are going up too, making it even more difficult to save up the deposit required for even the most modest of properties.
There is legimate concern on many issues, but the main question is this: how long can prices keep rising? Nobody knows, but it would seem that the collective mind has forgotten that property prices tend to be cyclical. And that right now, we’re breaking records.