Sector Focus
Property House prices to surge in the West Midlands
House prices in the West Midlands could grow by 4.8 per cent in 2018 – 1.8 per cent above the predicted UK average. That’s according to the latest UK
Economic Outlook from PwC. The report also estimates the average house price in the region will rise from £185,000 to around £225,000 by 2022. Matthew Hammond (pictured),
PwC’s Midlands region chairman, said: “The buoyant housing market reflects the strength of the West Midlands economy as a key growth area in the UK. “We are seeing the region fast
become a destination of choice for many businesses which is having a positive impact on the economic growth of the region and regional housing markets. While strong house prices are good news for many, we must continue to build much-needed homes across a range of housing tenures to make sure the market remains open to those who are not yet on the housing ladder.” Nationally, annual house price
growth is project to slow to around 3 per cent and is likely to remain around this level until 2025. The average UK house price is estimated to rise from £221,000 in
2017 to around £285,000 by 2025 according to PwC’s projections. Price growth at this pace means
the ratio of house prices to earnings is likely to remain broadly stable, but still at high levels by historical standards. In London, however, the average house price could drop by nearly two per cent in 2018 compared to last year and house price inflation could continue to be negative in 2019. PwC’s new analysis at the local
authority level across England suggests a clear link between a lack of new housing supply, relative to population growth, and local house price growth since 2011. Looking ahead, if the
government can achieve its target of building 300,000 new homes a year in England by the mid-2020s, then
this should exceed the increase in housing demand from projected population growth and therefore start to make up the backlog from past under-supply.
But PwC’s local analysis suggests
that many of these homes need to be built where demand is highest to prevent a further worsening of affordability in those regions.
Big deal:
2 Colmore Square
£95m deal is city’s biggest yet
RPMI Railpen and Nurton Developments have exchanged on Birmingham’s largest investment transaction of the year, with Railpen acquiring 2 Colmore Square and Cannon House. GVA and V7 Asset Management acted on behalf of RPMI Railpen,
with CBRE representing the vendor, Colmore Square LLP (Nurton Developments). Cannon House and 2 Colmore Square were purchased for
approximately £95m. The building is 95 per cent let off an average rent of £21.50 per sq ft and provides approximately 300,000sq ft of Grade A commercial space across seven floors, with retail accommodation at ground level.
68 CHAMBERLINK September 2018
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