Prices are continuing to rise in the UK’s Prime property markets, but at a more measured pace as vendors and buyers heed suggestions that the country’s economic growth may be at risk once again, according to Primelocation.com.
The Primelocation.com Prime Index shows that the average price of a UK property increased by 0.3% in July, taking the value to £458,413.
Prime Platinum property prices also rose by 0.3% to £641,145 and both tiers recorded positive annual growth. Levels of quality stock continued to rise, increasing by 6.6%.
London and seven of the ten regional Prime markets recorded price growth in July, with Yorkshire and the Humber (1.2%) and the North West (0.8%) the top performers. Annually, the Prime South East market experienced the highest growth of 3.5%.
Prices have risen for the majority of the year but growth is now slowing in some regions as concerns surrounding the health of the economy post Budget and the traditional summer lull in activity take effect. Despite this, vendors are continuing to put their properties onto the market and buyer demand remains strong, indicating an underlying confidence in the short term future of Prime property.
Andrew Smith, Research Director at Primelocation.com, said: "While the majority of regional Prime markets continue to record price growth, both vendors and buyers are acting with increased caution.
"Following the Budget, the possibility of a double dip recession and a downgrading of the UK’s triple A credit rating are back on the agenda once again. The Office for Budget Responsibility has warned that economic growth will not be as strong as previously forecast and Prime homeowners are responding to protect their interests accordingly.
"However, despite these concerns, buyers are well aware that cuts to the deficit could equally result in a stronger economic recovery and a level of optimism has been retained. Consequently Prime property market activity continues to be robust, witnessing only a slight dip in transactions that can be partly attributed to the seasonal lull that traditionally characterises the summer months.
"Vendors are still confident of being able to get a good price for their property but expectations are realistic.
"In London, where any economic concerns are felt less acutely due to higher levels of equity and disposable income, wealthy UK businessmen and foreign buyers are continuing to channel their money into Prime Central London town houses and family properties in the popular suburbs.
"Led by growth in London, we would expect average UK Prime property price growth to maintain a steady pace over the third quarter of the year, outperforming the property market as a whole as consumers exhibit and underlying confidence in the short-term future of top-end real estate."
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