Property values in Headingley remained static in March, with neither a rise nor fall, as Headingley people held their breath as to whether the Tory’s would return or we would have a Labour/SNP coalition. This followed several months of sluggish activity in the Headingley property market in the run up to the Election, leaving the average price of a property in Headingley at £227,900, still 4.1% higher than in March 2014. Despite the lack of change, the figures showed property values in Headingley were still higher in the first quarter of 2015 than in the last quarter of 2014.
Interestingly, the Council of Mortgage Lenders and Estate Agent trade bodies over the last few months have reported seeing a fall in mortgage lending and enquiries from prospective homebuyers. This is important because it comes amid an overall fall in housing market activity in Headingley. Data from the Land Registry said completed house sales in the Headingley and Leeds area in the three months to January 2015, (the most up-to-date figures available) fell by 14.8% compared to the same three month period up to January 2014.
However, I believe that the slowdown in property sales in Headingley is supporting Headingley property values, as there is a shortage of houses coming onto the market. Even though in the whole of the first Quarter of 2015, Headingley property value increases may seem subdued when compared to 2014, let us remember, property values are still rising well above the level of inflation.
As I have said many times before, the population in Headingley is growing at a much higher rate than the number of properties being built. This increasing demand for a roof over people’s head, which is outpacing the supply of new houses being built in Headingley, is creating a severe imbalance in the Headingley (in fact the whole of UK’s) housing market, thus making homeownership an ever increasingly distant dream for many of Headingley’s potential first time buyers.
In fact, I still maintain the view that house prices are likely to rise by around 3 to 5% in Headingley in 2015, even after taking into account this blip at start of the year. The reason being is that the rise reflects both strong economic conditions and steady market conditions with (and this is the most important factor) very low numbers of properties on the market.
Many Buy to Let landlords know that investing in the Headingley property market is a long-term strategy of 10, 20 even 30 years. Governments come and go, but unless Leeds City Council start to build thousands of new properties a year to make up for the shocking lack of supply, Headingley people will always want a roof over their head, and irrespective of which party is in power, if there aren’t any council houses and they can’t (or are unable to buy), a demand for rental properties will always remain.