Flats in Salford. Photo: Dave Thompson/PA Wire
Several UK cities have seen property prices surge by more than 15% since Britain voted to leave the EU in 2016, new figures suggest.
Leicester, Manchester, and Birmingham have seen the highest increases, seemingly unmoved by the greater uncertainty hovering over the UK’s property market in the run-up to Brexit.
Statistics from Hometrack and property listing site Zoopla show that 16 cities across the UK have seen prices grow by at least 5% since June 2016.
The cities with the highest growth also include Nottingham, Edinburgh, Cardiff, Sheffield, and Liverpool.
Leicester and Manchester recorded eye-watering increases of 17%, while Birmingham homes were up 16% since the referendum. Leicester and Manchester have also seen the fastest growth in the past year, with increases of 6.8% and 5.8%, respectively.
The latest monthly price report by Zoopla and Hometrack suggests near-record levels of employment and increasing affordability in the UK could be pushing up demand and prices in many cities.
Cities outside southern England have seen above average price inflation for the past three years.
“With unemployment at a record low and mortgage rates still averaging 2%, buyers appear to be largely shrugging off Brexit uncertainty until there is a material change in the overall outlook,” the report said.
“Buyers who have delayed purchases and stood on the side-lines since 2015 are starting to see greater value for money, perhaps seeking out buying opportunities while Brexit uncertainty impacts market sentiment.”
The report expects the strong growth in property markets outside London to continue, but at a slower pace. It said the number of postcodes recording dips in growth to below 5% has risen in Manchester and Birmingham.
“House prices cannot keep rising ahead of earnings indefinitely. We expect prices to keep rising in these cities but at a slower rate, closer to earnings growth. This follows the pattern recorded in cities such as Bristol and Bournemouth in southern England,” according to the report.
Slower growth in the past year is “more complex” than a negative Brexit effect, the report said, calling it a “compounding factor in markets where fundamentals have weakened.”
It points out transaction numbers and mortgage approvals have remained resilient nationally and are in line with the average for the past five years, despite falling sales in London in particular.