House prices in Manchester are now rising faster than anywhere else in the UK, according to a new report.
The latest Hometrack UK Cities House Price Index has found regional cities outside of the South East are registering greater house price growth than London, Cambridge and Oxford.
House price growth for Manchester rose by 7.3% in year to August, followed by Birmingham (6.7%) and Edinburgh (6.6%).
Annual house price growth is running at 4.9%, compared to 6.6% in August 2016.
However, London is dragging the headline rate of growth, with house price inflation in the capital running at 1.9% per annum.
Richard Donnell, research and insight director at Hometrack, said: “House prices continue to rise on the back of sustained price inflation in large regional cities as unemployment falls and mortgage rates remain low.
“Weak growth in London is acting as a drag on the headline rate of growth. We expect this pattern to remain a feature of the market for the rest of the year and into 2018.”
Other cities that have recently enjoyed strong growth such as Cambridge (2.8%) and Oxford (3.8%) have seen steep slowdown in the rate of price inflation over the last 12 months as affordability pressures constrain housing demand.
Aberdeen remains the only city in the top 20 to register negative growth down -1.9% for the year.
Hometrack said the total value of private housing in the UK’s top 20 cities has passed the £3 trillion for the first time, with London accounting for a whopping two-thirds of this figure.
Birmingham and Manchester the second and third most valuable cities, accounting for £152 billion and £132 billion, respectively.
Annual house price growth in UK’s regional cities
|City||Average price||% yoy Aug-16||% yoy Aug-17|
|20 city index||£249,900||6.6%||4.9%|