The North-South housing divide is deepening, according to latest figures from Nationwide's house price index, which reveals a stark divergence in regional property growth during the second financial quarter of the year.
While the North West experienced an acceleration in property values, rising by 3.9 per cent from 3.3 per cent in the previous quarter, the South of England, excluding London, saw a mere 0.1 per cent increase - fuelling concerns that a premiership led by Greater Manchester Mayor Andy Burnham could exacerbate this regional disparity.
Industry observers believe Mr Burnham's ambitious plans for greater devolution and 'levelling up' will intensify the divide, with Jonathan Hopper, chief executive of Garrington Property Finders, warning of an 'uptick effect' on Northern housing markets at the expense of Southern ones. He notes that the South has been lagging behind the North for over a year, and Mr Burnham's agenda could 'put more fuel into the northern markets and potentially detract from the southern markets'.
The affordability crisis in the Southern housing market is a significant factor, with property prices typically ranging from eight to twelve times average local earnings - contrasting sharply with the North, where prices are generally five to eight times average earnings. This disparity leaves buyers in the South at an increasing disadvantage, often requiring substantial generational wealth or multiple high incomes to secure a home.
Potential tax reforms floated by Mr Burnham, including abolition of council tax and stamp duty in favour of an annual proportional property tax, are also causing unease within the property sector. Critics argue this could unfairly penalise 'asset-rich, cash-poor' homeowners who purchased properties before the recent surge in values and may struggle with higher annual bills.