The latest study by Knight Frank has predicted what’s in store for the 2013 property market. ‘Last year was the third consecutive year of mediocre price growth across the UK, with prices likely to end the year down by around 1%,’ commented Liam Bailey, Head of Residential Research.
‘As always the average position across the UK has disguised the performance of different submarkets, and none has been more different than the central London market, which saw 9% growth in prices in 2012, which added to recent growth means prices in central London are now 34% higher than three years ago, UK prices are 1% higher over the same period.
International demand has helped to propel London prices higher and has also influenced the prime outer London markets, added the report, covering Wandsworth to Richmond, and Hampstead and Canary Wharf – where prices managed to rise by 5% in 2012 and a respectable 13% over the past three years.
Mr Bailey confirmed that the the country market continued to be affected by the ongoing economic malaise: ‘Outside of London, the weakness in the UK’s professional service and financial sector has not been offset by international demand, meaning the prime country house market has seen a slow decline in pricing continue thought 2012, with prices down by 4% in 2012 and down by a similar level over the past three years,’ said Mr Bailey.
However, land values have risen steadily, by 3% in twelve months and by 22% over the past three years. In town, prices in prime central London went from strength to strength, but 2012 was more turbulent for the wider UK market.
What is in store for 2013?
* UK house prices will not reach their 2007 peak until 2019: the longest housing market recovery on record, according to Knight Frank’s new forecast
* UK housing transactions to rise 2% in 2013, but to remain well below peak levels for the rest of the decade
* Tax changes forecast are expected to weigh on prime central London prices, with no price movement expected in 2013.
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