The prime residential markets across England and Wales appear at last to be stabilising as values turn positive in the high value markets around the capital. Commuter hotspots have recorded their first quarterly growth since March 2012, when early signs of a spring recovery outside London faltered.
The suburban markets surrounding London were the only prime areas to see positive annual growth, despite values remaining flat over the final three months of 2012. Here, prices are nearly recovered back to their 2007 peak values, remaining just -2.7% below.
A price increase of 0.5% was seen over the fourth quarter of 2012 in the inner commuter zone, the first sign of recovery extending beyond the M25. Price growth has focused in commuter hotspots such as Sevenoaks, Guildford and Chelmsford.
Urban locations
While the recovery remains London-centric, the rate of price falls is slowing right across England and Wales. With the exception of the Midlands and the North, average prime values across all regions fell by less than -1.0% in the last three months of 2012.
But recovery is uneven, even within regions, and over-pricing will quickly halt progress. Buyers are continuing to make a distinction between needs-based and discretionary purchases and this is leading to a preference for urban locations.
Across the wider South of England, prices of prime property in cities are on average -10.8% below their peak having fallen by just -0.3% in 2012. This compares to -14.8% from peak for neighbouring village locations which slipped by -1.7% last year. Similarly, cities such as York in the North and Cambridge in the East continue to outpace their regional average.
Even in the prime inner commuter zone, values are just -2.4% below peak in towns, while they remain -6.1% down in surrounding villages and -9.1% in rural locations.
