Housing demand surges outside southern England

Demand is rising outside of the South East, according to the Hometrack House Price Index.

There has been a sharp rise in transaction volumes in cities outside of the South East of England, which may result in significant house price growth according to Hometrack.

The latest Cities House Price Index from Hometrack revealed a 15%-35% increase across 2014 in cities outside of the South East, with Belfast, Leeds, Liverpool and Cardiff leading the way. In contrct, transactions in the higher value cities in the South are below average. And those lower sale volumes are resulting in slower house price growth.

City	Housing turnover in 2014 vs five year average	Change over 2014 vs 2013
Belfast	39.0%	20.3%
Leeds	22.9%	8.4%
Portsmouth	22.7%	13.2%
Liverpool	22.4%	8.1%
Southampton	21.8%	9.1%
Cardiff	21.3%	14.0%
Nottingham	20.9%	13.8%
Leicester	20.9%	18.4%
Manchester	20.9%	13.7%
Bournemouth	19.3%	9.5%
Sheffield	18.6%	8.7%
Bristol	17.5%	6.5%
Birmingham	16.8%	9.3%
Newcastle	16.5%	7.2%
Edinburgh	15.2%	5.1%
Glasgow	12.8%	3.8%
London	11.4%	-0.6%
Cambridge	4.6%	-13.4%
Aberdeen	4.5%	-6.8%
Oxford	3.4%	-1.6%

Source: Hometrack

Inflation

As a whole, annual house price inflation is continuing to slow, with growth of 10% in the 12 months to February compared to 11.6% six months ago.

According to Hometrack, city house price inflation ranges from 3.7% in Newcastle to 12.9% in London year on year.

Here's how the various cities shape up:

City	Average price	Relative to recent trough	Relative to peak (2007)	% year on year	Average growth pcm last 3 months
Glasgow	£110,228	8.1%	-13.4%	5.6%	1.1%
Liverpool	£110,034	8.4%	-14.7%	5.3%	1.1%
Oxford	£364,535	48.1%	24.9%	11.6%	1.0%
London	£412,055	57.0%	32.2%	12.9%	0.9%
Leeds	£143,688	11.2%	-8.0%	6.9%	0.8%
Sheffield	£124,904	9.9%	-5.2%	6.0%	0.7%
Cambridge	£355,740	59.0%	32.1%	10.8%	0.7%
Leicester	£143,312	17.6%	-0.7%	6.5%	0.7%
Bristol	£219,053	35.6%	9.9%	10.9%	0.7%
Manchester	£136,923	11.6%	-6.7%	6.4%	0.6%
UK	£185,114	19.7%	1.5%	7.5%	0.5%
Portsmouth	£193,083	25.1%	6.1%	8.4%	0.6%
Cardiff	£177,796	20.5%	1.4%	7.9%	0.5%
Southampton	£192,149	24.6%	4.5%	7.6%	0.3%
Bournemouth	£239,110	24.5%	2.5%	5.9%	0.3%
Newcastle	£119,968	8.4%	-9.9%	3.7%	0.3%
Nottingham	£125,334	15.6%	-2.9%	5.3%	0.0%
Birmingham	£132,419	10.4%	-6.5%	4.4%	0.0%
Belfast	£112,765	11.6%	-50.0%	4.6%	-0.3%
Edinburgh	£191,531	10.5%	-8.4%	6.8%	-0.4%
Aberdeen	£189,361	28.8%	13.0%	10.7%	-0.6%

Source: Hometrack

Mortgage buyer make up

Falling sales coupled with a general slowdown in activity in the run-up to General Election are resulting in lower mortgage approvals for home purchase.

Homeowners using a mortgage to buy a home made up two thirds of sales in 2014. The last third were cash buyers or those borrowing with a buy-to-let mortgage. In other words, groups who are not subject to mortgage affordability tests.

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