Residential prices have soared 21pc in the 'capital of culture'
Runaway house prices in the north of England suggest that the gap in property values between north and south will return to its long-term average by year's end, research indicates.
Liverpool is enjoying one of the north's biggest property booms since it won the title of European Capital of Culture 2008. Top estate agency chains traditionally focused on southern England are opening branches in the north.
Richard Donnell, head of research at FPDSavills, said the gap in north-south house prices would narrow in six months to a level last achieved in 1997, and there could be a further narrowing if a couple of quick, successive half-point rises in interest rates were avoided.
'If interest rates do not rise rapidly in the short term, it is likely the differential will narrow even further over the next 12 months,' Mr Donnell said.
'High house price growth in the north is being sustained by higher levels of affordability than exist in the south. Affordability constraints in the south are acting as a brake on house prices. The next result is a rapidly narrowing north-south divide.'