UK capital growth averages 8.5% in 2014 so far

UK capital growth averages 8.5% in 2014 so far

Property investors with buy-to-let assets in the north of England are set to benefit from high capital appreciation combined with strong rental returns.

Summary:

  • Residential property in the UK has recorded average capital growth of 8.5% this year
  • The average price of a home in the UK is now £189,332
  • Buy-to-let properties in the north of England are offering higher rental yields than assets in the south

UK residential property has recorded average capital growth of 8.5%, following a monthly rise of 0.3% in November.

The latest Nationwide House Price Index shows the average residential property in the UK is now worth £189,388.

A positive outlook for the UK economy is set to support the country’s housing market in the coming months and throughout 2015.

Robert Gardner, Nationwide’s Chief Economist, said: “The labour market has continued to improve, with employment rising strongly and the unemployment rate falling sharply in recent months. Moreover, indicators of consumer sentiment remain elevated, where healthy rates of retail sales growth and new car registrations also suggest that households are feeling more confident.”

As well as the high levels of capital growth that are on offer in the UK, property investors are finding that they can achieve high returns within the UK’s private rented sector.

Recent research by TotallyMoney.com revealed that buy-to-let properties in the north of England and offering investors the highest yields due to the more affordable land prices and rapidly expanding city populations. The report stated yields in Manchester were up to four times higher than areas in London such as Chelsea.

Furthermore, property consultancy Knight Frank has suggested that rental yields are set to grow at an annual rate of 3.5% between 2016 and 2018, as demand for properties in the country’s private rented sector continues to rise in the future.

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