Cambridge house price growth fastest among UK’s major towns and cities, raising concerns for higher rent and social problems
House prices in Cambridge have risen the fastest out of all major regional towns and cities in the UK, excluding the London Boroughs, according to figures for 2012 released by Nationwide last week. The Nationwide House Price Index report coined Cambridge as the number one “best performing” city for property prices, with a 6% annual increase in 2012.
Joining Cambridge in the top 5 best performing housing markets were Coventry and St. Albans, both with 3% annual price growth, followed by Brighton and Norwich, both with 2% annual price growth. The two worst performing regional towns and cities were Bradford and Manchester, both with a 9% drop in annual house prices.
The average house price in Cambridge, at £336,667, is significantly above the typical price of a home in England of £186,390. Cambridge’s performance is against a backdrop of most regions’ house prices falling; 11 out of the 13 UK regions have all experienced an annual fall in house prices during 2012. Cambridgeshire, with an average house price of £212,272 and despite experiencing a 3% annual drop in the fourth quarter of 2012, was listed as the most expensive housing area in East Anglia.
Whilst rapidly rising house prices in Cambridge are good news for home owners and investors in property in Cambridge, students have raised concerns that their College rent bill will go up while the City Council has proposed plans to raise the average rent in Cambridge by £4.50 per week from April.
A second year student at St John’s College said: “College rents tend to go up each year. Cambridge isn’t one of the cheapest cities to live in as a student anyway but the relatively high rents do not make it easier. When the cost of college owned accommodation is so high, I dread to think what the private sector is like. If College has to pay more for houses, then they’re going to pass the extra cost on to us. It’s worrying.”
On the other hand, Emily Diver, a recent Geography graduate from Cambridge who has decided to stay in the city to do a PGCE and look for teaching positions in Cambridge, is not deterred by the rising house prices. She said: “I will be looking for and applying for jobs in the Cambridgeshire area based on the fact that I want to complete my masters at the university whilst working, and that I’ve had really positive experiences at the schools I’ve been in.
“House prices won’t affect my decision; they will simply become the limiting factor on where I can live within the area once I have a job”, Emily explained.
Meanwhile, rising house prices and higher rents are stirring further social concern in the city in terms of rent arrears (uncollected debt from unpaid rent) possibly leading to evictions and families being made homeless.
Kevin Price, City Councillor for Kings Hedges, north Cambridge, and Labour Housing spokesperson, has recently spoken out against the high cost of rent arrears to the City Council with the above concerns in mind.
Speaking after the publication of a report detailing the City policy on the prevention and collection of rent arrears by council tenants, Councillor Price said: “There is already almost £1 million in old uncollected debts and this year the level of rent arrears has now reached £760,000, a significant rise of £100,000 since 2010.”
He added that he is “very worried about the impact of the welfare changes which start from April 2013, and especially the change to Universal Credit as Housing Benefit will now be paid directly to tenants.”
“There is a real concern that no provision seems to have been made for those who are already struggling to manage or vulnerable tenants such as those with mental health, drug and alcohol problems. Some families will also be at risk of doorstep lenders or payday loan companies who are more aggressive in chasing debts than the City Council. This could lead to a large increase in the number of tenants in arrears and to an increased number of evictions and tenants being made homeless”, Councillor Price warned.
Gwen Jing – News Editor
Photo – Jimmy Appleton