Property News

UK property prices: the next five years

Part Four: Northern Ireland, Wales and the top property investment hotspots

Having covered the top ten spots on the Barclays Property Predictor in the first three parts of this series, we conclude this epic Nethouseprices journey around the UK with an analysis of the final two regions: Northern Ireland and Wales. We then turn to Barclays' prediction for the top 15 property investment hotspots in the next five years. It's important to repeat our initial caveat - that the Predictor is carefully and expertly collated using a wide range of data sources and it is generally regarded as being a valuable research tool for property market participants, but unexpected events might significantly alter the picture, so you should always seek professional investment advice before committing resources to buying residential property.

UK averages

To put the information in the following paragraphs into some sort of context, we set out below the overall projection for the wider UK:

- House prices in the UK will rise by an average of 6.1 per cent by 2021.
- The average cost of a home across the country will increase to £300,000.
- London, with projected growth during the next five years of 11.88 per cent, will remain the engine of the UK property market.

11. Northern Ireland

Endowed with some of Britain's most spectacular scenery and home to some of its most vibrant cities and towns, Northern Ireland's formidable attributes are expected to encourage house price growth of 3.04 per cent. An expanding population and a booming private rental sector are also predicted to boost property prices.

The parts of Northern Ireland which can look forward to outperforming their counterparts are:

1. Lisburn and Castlereagh.
2. Belfast.
3. Ards and North Down.

Lisburn and Castlereagh, says the Predictor, will see population growth of around 4.8 per cent. This will inevitably increase demand for housing and pull prices upwards. Vital and prosperous, with excellent job opportunities, Belfast is currently one of the UK's most active rental markets, a feature which will continue to inflate house prices. Meanwhile, a very healthy 74.2 per cent of the working age population of Ards and North Down is in paid employment, and residents enjoy higher than average wages. The economies and labour markets in all three areas are slated for consistent growth in the coming years, with the cost of homes likely to experience a commensurate uptick.

12. Wales

Many readers will view the position of Wales in this list with surprise and not a little disappointment. But Barclays stresses that, with forecast growth of 2.88 per cent in the next five years, the housing sector in that gorgeous country will actually flourish, so there is no cause to be disheartened. Ever increasing job opportunities and the resulting wage hikes will ensure that property prices will continue their steady upward trajectory.

The star performers in Wales will be:

1. Monmouthshire, South East Wales.
2. The Vale of Glamorgan, South Wales.
3. Cardiff, South Glamorgan.

The key catalyst for price growth in each of these areas will, says the study, be the jobs environment. Employment in Monmouthshire, for example, now stands at 76.9 per cent, a situation which will persist and even improve in the coming years. Cardiff can expect similar progress. The private rental sectors in both areas are undergoing something of a renaissance right now and this is typically a sensitive indicator of an imminent rise in the cost of housing. Elsewhere, residents of the Vale of Glamorgan are comparatively affluent, receiving wages which are around 13 times the UK national average, another characteristic which will positively influence the market.


Top 15 property investment hotspots

As well as offering its insights into the regions and their best performing areas, Barclays identifies its tips for the overall top 15 property investment hotspots between now and 2021. They are as follows:

1. Richmond, London: Expected house price growth = 39.1 per cent.
2. St. Alban's, Hertfordshire: Expected house price growth = 38.8 per cent.
3. Three Rivers, Essex: Expected house price growth = 34.6 per cent.
4. Camden, London: Expected house price growth = 33.9 per cent.
5. Westminster, London: Expected house price growth = 31.9 per cent.
6. Cotswold, Gloucestershire: Expected house price growth = 31.8 per cent.
7. Wandsworth, London: Expected house price growth = 31.1 per cent.
8. Uttlesford, Essex: Expected house price growth = 30.0 per cent.
9. Mole Valley, Surrey: Expected house price growth = 29.8 per cent.
10. Warwick, Warwickshire: Expected house price growth = 29.5 per cent.
11. South Northamptonshire, Northamptonshire: Expected house price growth = 29.3 per cent.
12. Hertsmere, Hertfordshire: Expected house price growth = 28.1 per cent.
13. Waverley, Surrey: Expected house price growth = 27.8 per cent.
14. East Dorset, Dorset: Expected house price growth = 27.4 per cent.
15. Elmbridge, Surrey: Expected house price growth = 26.4 per cent.

Nethouseprices view?

As we underlined above, the Barclays Property Predictor is a fascinating snapshot of that institution's vision of the movement of house prices in the UK in the coming years. Based on impeccable research, it is a document of unquestioned gravitas. But these are uncertain times and the housing market has latterly defied the expectations of some of the most widely-respected property experts in the country. To that extent, we would urge you to read this report alongside those published by other agencies, to obtain a more holistic impression of Britain's property investment opportunities. Perhaps even more importantly, we'd recommend that you keep a close eye on the monthly house price indices, especially those produced by Halifax, Nationwide, the Royal Institution of Chartered Surveyors and the Office for National Statistics, because, whatever their acknowledged limitations, they remain the best barometers of the UK housing sector.

The team at Nethouseprices hopes that this feature has been interesting and that we will see you again soon. Our services include ongoing coverage of UK house prices, the private rental sector and housing policy and resources like our instant valuation tool to help you navigate the market.

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