Housing Price Bubble Or Not?

Mon 9 June 2014

I recently read yet another newspaper article that informed me that we were all experiencing a housing price bubble with significant house price gains across the country. But how misleading these articles can be!

The reality is quite different, there is no doubt that our agency offices are significantly busier since the beginning of this year with buyers returning from the south east and the home counties; our managers report vast improvement in viewing numbers compared to recent years and far better sales levels. But have we seen significant price increases in rural Wales and the borders – the simple answer is no.

Sales volumes have improved dramatically and there is definitely a feel of confidence to the housing market in this area and renewed optimism that we are returning to better times. It seems however that the media have picked up on the significant price growth on prime central London homes, the Land Registry show that these increased in value some 17% over the year ending at the end of April 2014.

But what of the price rises in our areas. The Land Registry shows the following Growth/ Reductions over the same period to the end of April 2014:

Powys – Reduction 3.8%

Shropshire -Growth 3.3%

Herefordshire – Growth 2.0%

Worcestershire - Growth 2.7%

What we must do is put these statistics into context. There are always going to be regional variations in price and each month the figures will alter depending on sales volumes and activity levels, but we must not get carried away by the prices in London which significantly distort the national averages and can lead to talk of yet another boom and bust.

Darren Thomas - Partner at Brecon Office