Average North East house prices £5000 down in cash terms over the last four weeks.
A summer slowdown in house prices seems to be continuing in the North East with current property values shrinking by 2.98% in June – wiping over £5000 from the price of the average property.
The fall means that North East house prices are now falling year by year – albeit with prices just 0.09% down on those recorded in June 2017, a fall of £196 in cash terms.
Figures from sales and lettings firm KIS and deposit free renting firm Dlighted show the North East housing market’s strong start to 2018 continuing to be a thing of the past– with homeowners seeing £5082 slashed from the value of the average home, a fall of over £8000 since the end of April.
Regional house prices previously rose by 3.2% in April and 1.3% in March.
A typical North East home is currently worth £165,291, compared to £170,313 four weeks ago and £165m457 recorded at the end of June 2017.
All 20 of the 20 of the areas surveyed by KIS and Dlighted recorded property prices falls in June ranging from falls of just 0.9% in Gateshead and Cramlington to 5.7% in Killingworth, 5% in Easington, 4.7% in Whitley Bay and 4.2% in Seaham.
Many areas continue however to have seen prices rise over the past 12 months, with property values in Killingworth (3.2%) and Whitburn (1.7%) performing strongest in percentage terms in the last year, with homes in Gatehsead, Morpeth, North Shields, Peterlee, Sunderland, South Shields, and Tynemouth worth more now than there were in June 2017.
Homes in Blyth and Whitley Bay have performed weakest over the past with properties losing 4.1% and 2.5% of their values respectively, £5396 and £5660 in cash terms.
Renters in the region are slightly better off than they were four weeks ago, with average rents down £2 a month on four weeks ago, falling from £580 to £576 – costing tenants £48 a year.
Easington remains the cheapest place to rent in the North East, with average monthly rents of £423, followed closely by Blyth (£439) and Jarrow (£452). Tynemouth (£960) and Durham City (£818) continue to be the most expensive.
The North East currently offers investors average rental yields of 4.2%, a 0.2% rise since April. Landlords in Peterlee (6%) Newcastle (5.3%) and Gateshead (5.2%) still offer the strongest returns, alongside Seaham (5.5%).
Whitley Bay’s rental yield remains the region’s weakest at 3%, followed by Morpeth (3.2%).
Newcastle’s yield of 5.3% means it offers better returns for investors than Gateshead (5%) for only the fourth time on record.
The average deposit renters currently have to pay on the basis of the government’s six week deposit cap is £866 – rising to £1227 in Durham, £1440 in Tynemouth and £1368 in Newcastle.
“Even though North East house prices are continuing to fall back – with areas North of the Tyne being hit particularly badly, there really is no cause for alarm, not least because the North East house market’s strong start to 2018 cushioned home owners from the current downturn.
“Property prices are falling year-on-year across Britain. In the North East they’ve stayed the same in places like Gateshead, North Shields, South Shields and Sunderland they’ve actually gone up, and in the case of Killingworth, are up by more than £5000.
“It’s fair to say that it is something of a buyer’s market right now, which with renters needing to pay deposits of close to £1500 in areas like Newcastle, Durham and Tynemouth is just as well.”
KIS Group were the first letting agents in the UK to abolish tenancy deposits, leading to the firm being named Letting Agent of the Year in 2013.
Dlighted is a deposit free renting solution which uses deposit replacement insurance to protect landlords and letting agents with a rent guarantee and against property damage and legal fees without charging tenants a deposit.