New data indicates that the housing market in Greater Manchester has significantly outperformed Greater London over recent years, with average house prices in the northern powerhouse region experiencing substantially higher growth. The analysis, conducted by Benham and Reeves using the government's UK House Price Index, compares housing market movements across both regions, specifically during the tenures of former Manchester Mayor Andy Burnham and current London Mayor Sadiq Khan. This trend comes as the Office for National Statistics (ONS) reported a 3.3% rise in average private rents across the UK to £1,388 a month in the year leading up to June.
Since Sadiq Khan became Mayor of London in May 2016, the average house price in Greater London has increased from £500,467 to £544,814, marking an 8.9% rise. In contrast, during Andy Burnham's time as Greater Manchester Mayor, from May 2017, average property values surged from £145,058 to £238,730, an impressive increase of 66.6%. This disparity highlights a notable shift in regional housing market dynamics, with Manchester demonstrating a more rapid appreciation in property values.
Beyond price growth, Greater Manchester also exhibited a more active transaction market and a slightly higher rate of new housing completions relative to its population. The data shows that Greater Manchester recorded an average of 1.1 residential sales per month for every 1,000 residents, compared to Greater London's 0.8 sales per 1,000 residents. Furthermore, Greater Manchester averaged an estimated 2.4 new dwelling completions per 1,000 residents each year since Mr Burnham took office, narrowly exceeding Greater London's average of 2.2 over a similar period.
Marc von Grundherr, director at Benham and Reeves, acknowledged London's continued importance as the UK's primary housing market, noting its long-term stability despite economic challenges. However, he emphasised the 'momentum' achieved in Greater Manchester under Mr Burnham, suggesting that a national approach combining housing delivery, regeneration, and economic growth could significantly boost development and investment across the country. Mr von Grundherr also highlighted the need for reform regarding Stamp Duty, describing it as an 'outdated and fundamentally unfair tax' that disproportionately affects buyers in higher-value markets like London and hinders market activity.
The call for Stamp Duty reform resonates with broader concerns about housing affordability and market fluidity. A significant reduction in this tax, according to Mr von Grundherr, could remove a major barrier for buyers, unlock pent-up demand, and stimulate activity throughout the entire housing chain, providing an immediate and substantial boost to the UK property market. Such a move would aim to ease the financial burden on individuals moving home and potentially encourage more transactions, benefiting both homeowners and the wider economy.