According to the Land Registry, second hand house prices remain 12% below peak in Norfolk, with prices in England and Wales also remaining below former highs.

However, the average price of new build houses in Norwich is higher now than in 2007 according to the Land Registry.

Transaction levels in both city and county have recovered from their dip in the spring of 2009 but are still running at some 40% below the levels recorded between 2002 and 2007.

The strong price growth recorded in London has yet to have a major impact on the rest of the country. As such, the bulk of activity in and around Norwich has been driven by local buyers and focused predominantly in the mainstream markets.

However, the ripple effect from London is long overdue, having taken longer than usual to breach the boundaries of the M25. Over the next couple of years, we expect to see prices in some parts of the south of England outperform London. Growth will not be uniform. We expect to see equity rich housing markets outperform those more reliant on mortgage finance.

Within Norwich city centre, where there is a greater number of higher density flat schemes, there has been solid demand for one and two bedroom apartments. Savills data shows the average price of a new build home in and around Norwich in 2013 is £235 per square foot.

However, the smaller units have recorded the biggest relative price increases. One bedroom flats have been selling for an average £261 per square foot following a 23% rise between 2011 and 2013.

The cost of two bedroom homes rose by 33% to £255 per square foot over the same period. Values for three and four bedroom homes have remained largely flat at about £230 per square foot.

That said, high value sales were recorded in 2013. Top floor apartments in Westgate Tower, a converted 1960s office block in the centre of Norwich, sold for between £400 and £500 per sq ft. Away from the city, bigger family homes have been selling well in higher value markets along the north Norfolk coast.

Buyer Demand

Up to this point in the recovery, the market has been dominated by local home buyers and investors with little influence from London and beyond. Help to Buy, the Government scheme designed to assist buyers with smaller deposits, has helped to galvanize demand from homebuyers.

The equity loan element of the scheme, aimed at buyers of new build, has helped to increase sales in some developments. At St Michael’s Place in Aylsham, a development of two to four bedroom homes, the launch of Help to Buy has served to push the rate of sales from between 12 and 15 units a year to 40 units a year.

We have also recorded steady demand from investors who have been returning to the market over the last couple of years. Approximately one in three purchases have been made by those taking advantage of strong rental demand from young professionals as well as a 33% rise in the number of students attending the University of East Anglia.

Growth in the number of foreign students, who now make up 22% of those studying at UEA, has contributed to the demand, prompting some developers to plan to market new schemes abroad in 2014.

Taken from
Spotlight: Norwich Residential Development Sales