North-South divide in property market widens

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The Independent Online

The property-market divide between London and the North of England is widening rapidly, with sales outside the capital now taking up to twice as long as those within it.

While properties in London are on sale for an average of six weeks before coming "under offer", in Yorkshire and Humberside it takes 11.9 weeks, with a similar delay in Wales and the North-west, according to the latest survey for the Hometrack website.

Richard Donnell, Hometrack's research director, said: "This is just one indicator of a continuing North-South divide. Since the beginning of the year, the impetus for price rises has emanated from London, while the overall trend has been downward across all other regions."

Analysis of sale prices reveals further differences across the country. While price alterations in London have remained positive in each of the past six months, in all other regions prices have fallen or remained static.

"The reality is that, against a backdrop of thin volumes, price rises in London continue to put a gloss on overall market conditions, limiting the real scale of house-price falls across the rest of Britain," Mr Donnell said. Average prices fell by 0.1 per cent in August, following similar falls over the previous three months.

But many key indicators in the survey show an improvement on the position from a year ago, despite the downbeat economic and financial situation. Demand for housing has actually continued to grow steadily since March, by 14 per cent, compared with a decline of 18 per cent in the last six months of 2010.

Mr Donnell warned that the outlook for the housing market was bleak. "There are signs that the balance between supply and demand is starting to shift in direction," he said.