North East house price rises pick up pace

Research from KIS Lettings suggests a positive housing market in the North East - although there is considerable variation from area to area

Ajay Jagota, KIS managing director
Ajay Jagota, KIS managing director

North East property prices rose by 1.1% in June - three and a half time faster than in May - analysis from a South Shields-based letting agent suggests.

The research from KIS Lettings shows the average property in the region is now valued at £152.908 - around £2000 more than four weeks ago.

However, there continues to be a good deal of volatility from area to area, and prices in the North East are not rising as rapidly as in other parts of the country.

If the trends of the past eight weeks were to continue, property prices across the region would rise annually by 8.4%.

This compares to predictions of 31% in Brighton and 26% in Waltham Forest.

Durham City recorded the highest monthly rise of 3.8%.

The second largest rise occurred in South Shields (3.8%), where property prices have risen by 5.7% in two months.

Similarly, on the other side of the Tyne, prices in North Shields rose by 3.1%, up 5.1% in two months.

Blyth, Cramlington and Seaham all recorded falls, the latter for the second consecutive month, with prices down 3.8% in eight weeks.

North East rents. meanwhile, have remained broadly static, albeit rising at a faster rate than last month.

Typical prices rose by £5, driven by Durham City, where rent rose by 5%, perhaps driven by dwindling stocks of student accommodation at the close of the academic year.

Rents in Darlington have fallen noticeably in the last eight weeks, down 4.4% since April.

They have also continued to fall in Easington (-2.5%) and Peterlee (-1.2%).

Seaham is KIS’ ‘Best to Invest’ tip for property investors this month, with strong and rising yields for investors and modestly falling prices.

The company likewise considers South Shields the best place to rent, with the region’s second highest rise in house prices and typical rents (£489) near identical to average mortgage rates (£483).

KIS founder and managing director Ajay Jagota said: “The property market in the North East is generally positive at the moment, with considerable activity in terms of purchases and sustained yet sustainable price rises.

“There continues to be huge variance from area to area, with a 6.5% difference between the falling prices in Blyth and the rising prices in Durham.

“Not only does this show the value of both localised analysis like ours and making investment decisions guided by expert local knowledge; it shows how vital it is the Bank of England gets the measures it is expected to announce this week to cool the property market.

“In many parts of the North East, the property market continues to need anything but cooling. Treat a South East problem as a national one and you won’t just be cooling the property market; you’ll be cooling the entire economy.

“A little local knowledge goes a long way in property. Investment orthodoxy could well lead you away from areas traditionally less fashionable areas the A19 corridor, but our analysis continues to suggest that’s where the highest rental yields are often to be found.

“Seaham in particular looks like a good place to find a bargain right now, although South Shields seems one to watch in terms of property prices.”

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