Leicester Property Profits are Huge But Only If You Brought in Year…

House prices rising Leicester House Prices are rising according to Harry Albert Lettings & Estates

If you were lucky enough to have purchased your property in Leicester over the last couple of decades, you’ll have certainly seen a healthy return on your investment. New data from theh Land Registry suggests that property prices in the city and county have increased by more than 250% since the Year 2000 and other reports show Leicester is experiencing the fastest growing rent prices in the UK.

Coastal areas, like Southend-on-Sea and other tourist-towns, saw larger increases with Southend-on-Sea experiences a house price increase of 287.1% since the first month of 2000 whilst several boroughs in London have experienced property price inflation of more than 300% but Leicester comes in close behind the coastal towns with a decent 268.7% increase in property values in Leicester.

The organisation who compiled a report on the Land Registry data said;

While London is the clear winner when it comes to house price growth since the turn of the century, prices have boomed in many areas outside the Capital as these figures attest. What’s more impressive is that in the middle of this 18-year period, we experienced one of the worst recessions this country has ever seen. It shows the resilience of the UK property market.

Will this continue for the next generation of Leicester homebuyers?

Leicester Property Profits are Huge But Only If You Brought in Year... 1Leicester Property Insight wonders whether excessive value increases will be benefited by the next generation of homebuyers, especially when we consider starter homes are now 33% less affordable in the city than they were in 2012, at the end of the last financial crisis whilst house prices for first-time buyers are now almost seven times more than the average wage in Leicester.

Further data from the Land Registry details the average house price for first-time buyers was just over £150’000 in April this year, almost £43’000 higher than it was in 2012 when the average cost of a first-home was just £107’424.

The average salary in Leicester is just under £21’782 a year meaning house prices for the average first-time buyer stands at around seven times higher than the average wage. In 2012, house prices for first-time buyers were just over five times higher than the average salary, this is an increase of a third between the ratio of house prices/wages in Leicester City.

Because of rising house prices, it’s no surprise that owning property in Leicester is increasingly out-of-reach for many lower-income earners and those with less capital to put towards a deposit on their Leicester home, especially with the Bank of England introduction of new rules to cut back on risky mortgages in 2014 which restricts banks and other lenders from offering mortgages that are higher than four and a half times the borrower’s income unless the borrower meets other criteria (including value of other owned assets and other securities that can be used as collateral for the loan).

Nationally the average price for a home for new buyers went past £200’000 last year and now stands at £204’667 with the Northeast of England still being one of the cheapest areas to purchase a property.

With all this being said, there are downturns in the rates in which property prices are rising, including in Thurmaston and other areas on the outskirts of the city where house prices have begun to fall whilst areas such as Belgrave and Narborough Road and other parts of the West End of Leicester are still seeing rising house prices albeit the rate of property value increase is falling in these areas too.

“First-time buyers in Leicester should remain hopeful”, according to Harry Albert Lettings & Estates, “as house prices across Leicester seem to be rising at a slower rate than they have been since 2014; this will mean, should house prices continue to follow current trends, Leicester homebuyers may be able to snap up properties with a more appealing price tag over the next two to four years.”

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