Cost of buying a flat 'set to rocket'

The average flat, currently worth £181,288, is forecast to cost more than a quarter of a million pounds by 2012 - a rise of 53 per cent over the next five years.

Prices in the most sought-after areas of the city will increase by even greater amounts according to Horsham-based property experts Technical Forecasts.

Estate agents say the city housing market is continuing to rise above the national average because of an influx of buyers and investors from London.

Capital salaries and bonuses are being spent on second homes in Brighton and Hove which is forcing prices up - and out of the reach of those in Sussex looking for a home.

Flats in the Brunswick district of Hove are expected to leap in value by a massive 73.9 per cent, from an average of £244, 815 to around £423,529.

In the next year alone, the average Brunswick flat will rocket in value by £50,000.

House prices also show no signs of slowing down.

In the Queen's Park Road area, the price of semi-detached homes will rise by 30 per cent while terraced houses will rise by around 46 per cent over the next five years.

A terraced house in Goldstone Villas, Hove, just a few minutes walk from the station, costs around £336,000, but this time next year buyers will have to fork out about £370,000 for the same property.

Giles Soutry, regional sales director of estate agency Hamptons International,said he had no doubt the city would buck the downward trend seen in other parts of the country.

He said: "Brighton and Hove is a very different market to the rest of the country.

"Despite some areas of the country hitting a seriously rocky period recently, as a result of the credit crunch, the Brighton and Hove region remained strong and looks set to do so as we move into the latter part of 2007.

"The economic fundamentals that drive the Brighton property sector currently remain solid with low inflation, high employment and a probable reduction in interest rates in the near future. The result will be long term sustainable stability, rather than a crash."

He said consistently high demand from London buyers and tenants was a key reason for the rises.

So far this year 16 per cent of the firm's business in Brighton has come from London-based clients, although during a peak period in May almost three-quarters of buyers were from the capital.

Brighton prices might seem high, but they're far more affordable than those in the capital, where the average property price stands at £349,838.

In the south east the average property is expected to rise in value by 39 per cent over the next five years, while nationally a 41per cent rise is predicted.

The escalating rises may be good news for those already on the property ladder, but within a few years it could be almost impossible for first-timers to buy in the city without significant help from their parents.

To afford an average-priced flat in the city today a buyer would need to earn around £52,000.

By 2012 they would need to earn more than £79,000, based on the Technical Forecast projections.

Councillor Brian Oxley, the leader of the city council, said: "A lot of people want to move here because of the quality of life but other issues come into play as a result. "The price of houses is a problem, we know it is a problem, and we are looking at how we can best deliver affordable homes. "Most people want to buy their own home and we need to examine shared ownership so people can get on the property ladder. "We also need a really strong, thriving economy here so people can afford properties."

The firm formulates their predictions by analysing historical sales figures as well as other neighbourhood-based statistics such as unemployment levels, industrial output, bank rates and business activity.

Some estate agents in the city were circumspect about the figures.

Jeremy Whittingham, the office manager at Tingley's in Church Road, Hove, said: "Prices will be strong but whether they will rise by 53 per cent I can't say.

"I wonder whether a studio flat - which averages at around £125,000 will be fetching £200,000 in five years' time.

"The market is stabilising, certainly.

"Brighton is very small and people are coming in rapidly. We do have a shortage of properties."

David Power, a sales negotiator with Spencer and Leigh, said he doubted whether all parts of the city would see big rises.

He said: "It seems a bit high and I would be surprised if we saw those sort of rises in our area, which is mainly Patcham and Withdean.

"We have some flats in the London Road area which are on at about £200,000, and it's difficult to imagine them going for £300,000."

• Did you move from London for the good life in Brighton or Hove? If so, please contact reporter Rachel Wareing on 01273 544547 or email rachel.wareing@theargus.co.uk
• See Friday's edition of The Argus to find out how much your property is predicted to rise within the next year.

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