Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), and CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he is one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - & author of Things That Make You Go of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, MacroBusiness.

Wednesday, 4 June 2014

UK house prices +11.1% y/y to record highs

New heights

Nationwide's House Price Index has now surpassed its mid-2007 previous peaks on a national basis (click chart):

As we predicted, it's London leading the way with a mammoth increase in average prices of apprpximately 18% over the past year, while the south east has also recorded exceptionally strong growth (East Anglia +10% y/y).

The UK housing market is very much a two-speed affair with prices elsewhere having picked up, but at a much more subdued pace of around 6%, which comes off the back of a very weak half decade for UK housing ex-London.

In real terms, house prices outside London are well down on their 2007 levels, which has improved affordability.

The level of first homebuyer purchase activity in Britain has reached a new record high at a staggering 48%. 

This is miles above the long run average and contrary to popular opinion has not been driven by the Help to Buy scheme (the numbers of which remain relatively modest).

Interest rates may rise in the UK in 2015, but nevertheless the property markets continue to have strong momentum on their side.

UK hotspots

If you're looking for UK property hotspots, try Croydon in South London, which we highlighted here previously (I actually bought in Croydon myself back in 2013).

Brett Allegre-Wood wrote this piece yesterday, which we agree strongly with:

"In 2013 London Mayor, Boris Johnson, announced a regeneration plan for the area and confirmed a £1bn investment to transform the area’s economy and drive employment. Plans will see public spaces transformed, the town centre revamped and the introduction of sophisticated, modern new homes. 

Along with the Mayor’s commitment, Croydon is also finding support from the private sector with Westfield & Hamerson joining forces and investing a further £1bn in a new, international shopping destination, The Croydon Partnership.

House prices are still at accessible levels; Croydon is currently the fifth cheapest borough in London, and the perfect place to invest, especially considering the regeneration plans and consequently the predicted rises in house prices.

The Croydon Partnership will transform the outdated Whitgift and Centrale shopping centres into 1.5 million sq ft of retail and leisure space. This will include a major department stores, a full range of shops, cinema, bowling alley and restaurants.
This £1billion project will act as the catalyst for the wider regeneration of the town centre and includes up to 600 new homes. Unsurprisingly given the addition of a major new attraction to the town centre, house prices throughout the borough can expect to increase at a quicker rate than other London boroughs.
East Croydon’s fast and frequent service gets to London Bridge in just 14 minutes and London Victoria in 16 minutes. With 24 trains per hour East Croydon has zone one accessibility. Also, from the centre of Croydon is Gatwick airport, one of the UK’s biggest and busiest international airports, only takes 15 minutes. Croydon truly is a connected City suitable for any prospective tenant, below you will see an example of travel times for the area:
  • London Bridge – 14 minutes
  • Victoria Station – 16 minutes
  • Canary Wharf – 33 minutes
  • Heathrow Airport – 43 minutes
  • Gatwick Airport – 16 minutes
  • Covent Garden – 24 minutes"

Brett's right as usual, of course, and new Westfield projects have a history of inspiring capital growth. Read the rest of Brett's article here.


As of June 1, I'm an FCA (Chartered Accountant Fellowship). Goodness, I used to think FCAs were so old...