Property price rises in new towns remain subdued

People who are approaching north London estate agents with houses for sale may have greater cause for optimism than those who are trying to sell their properties in the UK’s so-called ‘new towns’.

According to research conducted by Lloyds TSB, the prices of houses and flats in these more recently developed areas remain lower than in long-established cities like London.

The average price in a new town is ?182,354, which is just over six times the gross annual average salary of ?29,794. The value of real estate in these places has risen only one per cent since 2007. This is despite the fact that earnings in the towns have increased by nine per cent.

Commenting on the phenomenon, housing economist at Lloyds TSB Suren Thiru said: “Many new towns are within easy commuting distance of major commercial centres, where housing is typically more expensive.

This is particularly striking for new towns in the south-east, where the average property price is close to half, on average, compared to that in London.

Meanwhile, the firm also noted that while the average house price in a new town has increased by around 74 per cent since 2002, prices in England and Wales as a whole have gone up by 92 per cent.

The new town that has seen the greatest improvement in housing affordability since 2007 is Corby in Northamptonshire. The average price of real estate there has fallen from 6.2 as a multiple of gross annual average earnings to 4.8. This is in part due to a fall in house prices.

Location is of course a major factor when it comes to property values. However, it is still important for consumers to ensure they receive an excellent service from their estate agents.

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