It’s quite
amazing just how much prices have increased over the last
few years, just look at this graph produced by the Nationwide
Building Society!
The number one question I constantly get asked is ‘Will
the property market crash? Surely it can’t keep booming?!’
Well ultimately the property market depends on five key criteria;
Interest rates which may peak at 5.5% but these are still
historically very low, low unemployment, low inflation, demand
& supply and the very important feel good factor (known
as market sentiment). The market is starting to slow up again;
however the last few years have been pretty good. London has
a great story for the future; the Olympic Games should ensure
that property values remain buoyant together with a strong
City, tourism, the new Wembley stadium and terminal 5 Heathrow
to name but a few huge projects. The rest of the country will
come off the boil in my opinion and struggle to maintain past
property price increases
Housing Statistics
Between 1971 and 2004
the number of dwellings in Great Britain increased by 35 per
cent, to 25.3 million.
In 2004 London had the
highest proportion of new dwellings built on previously-developed
land (excluding conversions), at 94 per cent. The region with
the lowest proportion was the East Midlands, at 52 per cent.
Between 1999/2000 and
2003/04 the number of UK households that owned second homes
abroad increased by 45 per cent to reach almost 257,000. Almost
half of these homes were located in Spain and France.
In 2004 annual house price
inflation was highest in the North East at 26 per cent, although
average property prices here were still lower than in any
other region of England.
General Trends
The UK has a growing population. It grew by 280,600
people in the year to mid-2004, and the average growth per
year has been 0.4 per cent since mid-2001. The UK population
increased by 7.0 per cent since 1971, from 55.9 million to
59.8 million in mid-2004. Growth has been faster in more recent
years. Between mid-1991 and mid-2003 the population grew by
an annual rate of 0.3 per cent.
Population growth has not occurred evenly across all age groups,
however. The percentage of people under age 16 fell from 25
per cent in mid-1971 to 19 per cent in mid-2004. Over the
same period, the percentage of the population aged 65 and
over increased from 13 per cent to 16 per cent.
In 1961, there were 27,224 divorces in Great
Britain, which by 1969 had more than doubled to 55,556. The
number of divorces doubled again by 1972, to 124,556 in Great
Britain and 124,991 in the United Kingdom. (This latter increase
was partly due to the Divorce Reform Act 1969 in England and
Wales, which came into effect in 1971).
In 2004, the number of divorces granted in the UK increased
by 0.2 per cent to 167,116, from 166,737 in 2003. This is
the highest number of divorces since 1996, and the fourth
successive annual increase. This is 7.2 per cent lower than
the highest number of divorces which peaked in 1993 (180,018).
With increased divorce rates the number of single people and
single parent families requiring homes is rapidly rising.
Couple this with an increasing and ageing population and it
is easy to see why demand for new housing is so high.
(Source: Office
for National Statistics)
For detailed reports and further information you may wish
to consult these sources:
Council
for Mortage Lenders
Department
for Communities and Local Government
Nationwide
- House Prices
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