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Migration ‘key to house prices’
3 March 2007
Research by Propertyfinder.com has revealed migration and immigration to and from the UK are key factors in how house prices perform.
The study found a 73 per cent correlation between regional population growth and house price growth. Regions with the highest inward migration saw the highest house price increases, while the least popular regions saw house prices under perform.
A correlation of 94 per cent was found when the study excluded the North East, an exception to the trend due to its low population growth and significant house price rises over the last 10 years.
In 2006, 11 per cent of the population moved around the UK, while 565,000 immigrants set up home here. The study found immigrants did not choose the same regions as UK movers.
Warren Bright, chief executive officer of Propertyfinder.com, said: “The overall level of house prices depends largely on the wider economy. However, the relative strength of regional housing markets is very clearly due in large part to population movement and demand for housing in the most popular regions has caused property prices to rise the fastest.”
Roy New, a sole broker based in London, commented: “Housing prices will definitely be affected by immigration from the new EU countries. It’s good news for the buy-to-let and commercial markets, as these people are hard working and will be setting up businesses and renting.”