Over the last month, the Boston property market has seen some interesting movement in house prices, as property values in the Boston Borough Council area dropped by 2.5% in the last month, to leave annual price growth at 1.3%.
These don’t compare as well to the national figures, where property prices across the UK saw a monthly uplift of 0.42%, leaving the annual property values across the country 8.3% higher. This might be down to the constraining factors of Stamp Duty changes in the spring and more recently our friend Brexit, however, it does mean there might be some bargains out there for landlords and homebuyers alike.
Looking at the figures for the last 18 months makes even more fascinating reading, whereby house prices are 9.3% higher, again thought provoking when compared to the national average figure of 13.6% higher.
However, it gets more remarkable when we look at how the different sectors of the Boston market are performing. Over the last 18 months, in the Boston Borough Council area, the best performing type of property was the detached, which outperformed the area average by 0.16% whilst the worst performing type was the apartment, which under-performed the area average 1.77%.
Now the difference doesn’t sound that much, but remember two things, this is only over eighteen months and secondly, the gap of 1.93% (the difference between the detached at +0.16% and apartments at -1.77%) converts into a few thousand pounds disparity, when you consider the average price paid for a detached property in Boston itself over the last 12 months was £189,700 and the average price paid for a Boston apartment was £89,400 over the same time frame.
I know all the Boston landlords and homeowners will want to know how each of the property types have performed, so this is what has happened to property prices over the last 18 months in the area…
- OVERALL AVERAGE +9.3%
- DETACHED +9.5%
- SEMI DETACHED +9.5%
- TERRACED +9.2%
- APARTMENTS +7.4%
So what does all this mean to Boston homeowners and Boston landlords and what does the future hold?
When I looked at the month-by-month figures for the area, you can quite clearly see there is a slight tempering of the Boston property market over these last few months. I have mentioned in previous articles that the number of properties on the market in Boston has increased this summer, something that hasn’t happened since 2008. Greater choice for buyers means, using simple supply and demand economics, that top prices won’t be achieved on every Boston property. You see some of that growth in Boston property values throughout early 2016 may have come about because of a surge in house purchase activity resulting from the increase in stamp duty on second homes from April, thus providing a temporary boost to prices.
However, it may be possible the recent pattern of robust employment growth, growing real earnings and low borrowing costs will tilt the demand/supply seesaw in favour of sellers and exert upward pressure on prices once again in the quarters ahead.
So Boston property values, assuming that everything goes well with Brexit, I believe in twelve months’ time we should see values in the order of 1% to 2% higher.