There’s been lots of uncertainty and apprehension for the UK and specifically the UK property market since Brexit. But some interesting data has been found. THE average UK house price has climbed by £17,000 in a year, continuing a “strong” run of growth, according to an official report. The typical property value was around £217,000 in July, marking an 8.3% year-on-year increase, according to the Office for National Statistics (ONS).
Notably property values have also increased by £1,000 compared with the previous month. While the 8.3% rate of annual growth is a slowdown compared to a rate of 9.7% recorded in June, it continues “the strong growth seen since the end of 2013”, the report said. Property prices are regional. The average house price in England now stands at £233,000, while in Wales it is £145,000, Scotland £144,000 and in Northern Ireland it’s £123,000.
Across the regions of England, London understandably continues to have the highest average house price at £485,000, followed by the South East and the East of England, where house prices stand at £313,000 and £274,000 respectively. The lowest average price continues to be in the North East at £130,000.
Post Brexit the UK Property Market seems to be doing OK to say the least. In fact it’s very encouraging news. This is a great boost for our London Property Bond which continues to be a success. maintaining a strong level of equity and security for investors. Although the pound has weakened it has proved a huge motivation for overseas investment into areas such as London. The Chinese are seeing a 15% improvement on the exchange rate.
Barrington Howe has seen an increase in pensioners investing over the age of 55 in the last 2 years showing that pensioners are being forced to invest their funds. There could be a number of reasons as to why the over 55s feel the need for extra income. With the new pension rules since April, people are able to draw down lump sums of their pensions or utilise pension release rather than take out an annuity. Maybe increase knowledge and awareness of other investment opportunities have acted as a catalyst to look beyond the traditional pensions which have not performed particularly well.
Why are more pensioners investing?
“We have noticed that when we sit down with clients and explain the opportunity, they clearly understand the investments”. Barrington Howe Managing Director Peter Evans states “with the feedback we receive from clients, it’s evident that they have not been given a clear explanation of investments and as such their understanding has not been what it should be”. Peter goes on to say “our role is to explain rather than hard sales. This then allows a client to make an informed decision going forward. The investment opportunities we have speak for themselves in terms of their clear business model for profit, performance and track records. We try to keep things simple and don’t use unnecessary jargon.
Due to underperforming pensions, the over 55s are using pension release to then go on to invest rather than spend so that they can increase their levels of income. Barrington Howe’s Managing Director states “We’ve noticed a trend towards clients wanting a combination of something secure, double digit returns and short term agreements. Pensioners are not looking for high risks and require the flexibility of a short term agreement should their circumstances change. Peter goes on to say “I think it’s a very sensible attitude to adapt. A pensioner does not have the luxury of being able to earn high salaries through employment so it’s vital that they are sensible in their attitudes to investing. One of our clients is an elderly couple in their 70s who invested to enjoy the returns with extended holidays. Some just for additional income for the long term”. But the trend is evident that previous financial markets have not performed well resulting in pension pots lower than expected. The over 55s have spoken and have now taken action.