The truth behind recent property market figures

The property market has rarely been out of the news in recent months, with a sea change in the industry bringing about arguments over whether this was a positive or negative development.
It all dates back to George Osborne's announcement of the Help to Buy scheme at the beginning of 2013. This made for a more buoyant property market as it gave developers the guarantee they needed to start new projects and also safeguarded mortgages for first-time buyers. The result was a great influx of new buyers into the market and some of the most positive-looking prospects since 2007.
A result of this, however, was an increase in house prices, with most recent figures putting the annual rise at anything between 3.1 and 5.5 per cent.
These are, of course, headline-grabbing figures that command attention and pique interests. When delving a little deeper, however, it becomes apparent that all is not exactly as it may first appear.
The North-South divide
A divide in housing between the north and south has been apparent for generations. The typical hotspots of London and the South East have seen prices soar - even at times of recession elsewhere - whilst those above the fabled line command a markedly lower premium.
This also impacts figures when looking on a national scale. Of course, those aforementioned headlines need brevity, so long-winded explanations on geographical disparities need to be saved for the main body of the story. Yet even then, this was often glossed over or not even mentioned at all.
In actual fact, despite the reports of price rises and runaway housing bubbles, the regions have experienced something rather different. Many areas in the north have seen property prices fluctuate, with prices remaining largely unchanged, or at very least rising slowly. Then, soaring costs in London dragged the national average upwards and skewed results.
Wage stagnation
Another point to consider is that of stagnating wages. Businesses may be emerging from the recession but many are still tightening their belts, with annual pay revisions still much below their pre-crash totals. Thus, any first-time buyers find themselves grappling with a property paradox. All the while values stagnate, lending is hard to come by. Yet price increases will make mortgages more available, but take many properties out of their financial reach.
Either way, rises at rates such as those seen in London could well be crippling for would-be regional buyers.
Impact
The impact of these potentially misleading figures should really not be underestimated. Sucked in by these reports, homeowners in the north have opted to stay put in the hope of more price rises - thus offering them a greater return but also a more competitive market in which to sell.
In actual fact, however, this wait may be largely in vain, at least if prices for their specific area remain in their current state of flux. Instead, prospective sellers will be disappointed in having waited around on a market that is still unchanged and is being continually manipulated by regional divides.
Regardless of whether the market is one for buyers or not, and which of the wildly varying price increase estimates is actually correct, one thing remains clear - property price reports should certainly not be taken on face value.