Comprehensive Spending Review to hit housing market
October 19, 2010 at 1:15 PM Lawrence Hall Leave a comment
The Chancellor will set out the Government’s four-year public spending plans in the Spending Review at 12:30 on Wednesday 20 October. This announcement will reveal just how extensive the cuts to government spending will be. It’s anticipated that a significant number of public sector job losses will happen over the coming years. This could mean that areas with high rates of public sector employment are likely to take a disproportionately hard knock over the coming months.
In areas where more people are employed by the state, rising unemployment will lead to more homeowners struggling to pay their mortgages as well as dampening demand from buyers, which will put downward pressure on house prices in these areas. House prices are likely to be far more resilient in areas with a smaller share of public sector employees.
Here are areas in England and Wales where house prices are most and least likely to be hit the hardest:
Top 20 areas likely to be most affected
| Rank | Local Authority Area | % of workforce employed in the public sector | Current avg. property value | 3 year % change |
|---|---|---|---|---|
| 1 | Oxford | 46 | £326,396 | -3.61% |
| 2 | Denbighshire | 45 | £146,289 | -9.06% |
| 3 | Cambridge | 43 | £306,521 | -6.88% |
| 4 | Middlesbrough | 43 | £117,623 | -8.53% |
| 5 | Hastings | 43 | £164,255 | -5.19% |
| 6 | Ceredigion | 42 | £185,569 | -7.53% |
| 7 | Canterbury | 40 | £224,699 | -10.11% |
| 8 | Stafford | 40 | £188,162 | -8.54% |
| 9 | West Dorset | 40 | £271,555 | -9.22% |
| 10 | Merthyr Tydfil | 39 | £94,854 | -7.85% |
| 11 | Sefton | 39 | £170,518 | -9.66% |
| 12 | Liverpool | 39 | £132,083 | -10.21% |
| 13 | Greenwich | 39 | £276,512 | -3.64% |
| 14 | Taunton Deane | 39 | £214,130 | -9.03% |
| 15 | Lewisham | 39 | £265,822 | -3.42% |
| 16 | Swansea | 38 | £151,570 | -9.47% |
| 17 | Eastbourne | 38 | £207,468 | -7.88% |
| 18 | Newcastle upon Tyne | 38 | £166,890 | -9.10% |
| 19 | Blackpool | 37 | £114,300 | -14.58% |
| 20 | Gwynedd | 37 | £155,043 | -8.70% |
Source: Zoopla.co.uk / ONS
Top 20 areas least likely to be affected
| Rank | Local Authority Area | % of workforce employed in the public sector | Current avg. property value | 3 year % change |
|---|---|---|---|---|
| 1 | City of London | 4 | £468,962 | 3.14% |
| 2 | Crawley | 12 | £211,235 | -5.82% |
| 3 | Corby | 13 | £132,191 | -8.61% |
| 4 | North Warwickshire | 14 | £173,686 | -9.31% |
| 5 | Broxbourne | 14 | £260,362 | -6.00% |
| 6 | NW Leicestershire | 14 | £175,327 | -8.16% |
| 7 | Bracknell Forest | 14 | £271,346 | -6.80% |
| 8 | Hillingdon | 15 | £289,043 | -5.04% |
| 9 | Tamworth | 15 | £151,501 | -9.11% |
| 10 | Three Rivers | 16 | £389,658 | -5.34% |
| 11 | South Holland | 16 | £152,377 | -10.41% |
| 12 | Harborough | 16 | £239,865 | -8.49% |
| 13 | Slough | 16 | £202,182 | -8.93% |
| 14 | Thurrock | 17 | £186,756 | -7.21% |
| 15 | Hertsmere | 17 | £367,525 | -5.16% |
| 16 | Tower Hamlets | 17 | £329,663 | -3.74% |
| 17 | Trafford | 17 | £239,271 | -9.41% |
| 18 | Woking | 17 | £344,991 | -5.66% |
| 19 | Flintshire | 17 | £164,483 | -9.84% |
| 20 | Hounslow | 17 | £328,716 | -5.47% |
Source: Zoopla.co.uk / ONS
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Entry filed under: House Prices, Politics. Tags: chancellor, comprehensive spending review, George Osbourne, House Prices, public sector cuts.
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