North-South divide benefits Potteries property
The widening gap between low house price inflation in the North and surging property values in the South is currently the best possible news for homebuyers in North Staffordshire, according to one of the area's leading estate agencies.
Heywoods Property, based in Newcastle-under-Lyme, is concerned that a regional increase in house price inflation to levels seen in London and the South East would price first-time buyers out of the market.
The company said that many first-time buyers were struggling to save the high deposits demanded by mortgage lenders, which have increased by an average of 100% since the onset of the credit crunch 18 months ago.
It warned that if the modest house price inflation in the Stoke-on-Trent area began to pick up momentum it could be the straw that broke the camel's back, locking out swathes of first-time buyers from the region's housing market.
Heywoods also believes that a period of slower house price recovery benefits existing homeowners by keeping down the cost of stepping up to a larger home and helping to reduce the chances of another boom and bust scenario.
The company also explained how the mini boom in the South East would eventually have a knock-on effect on prices in the North and Midlands.
It said that, historically, house price inflation had always started in London and radiated out towards the rest of the UK over time. It was therefore inevitable that prices in North Staffordshire would eventually creep up more quickly.