The number of homes sold in the Bristol postcode encompassing Avonmouth nearly doubled in 2014 from the previous year, fuelling fears that Britain’s latest property hotspots could develop into regional house-price bubbles.
Avonmouth, next to the Royal Edward Docks (a vibrant area that has benefitted from extensive regeneration) was the district with the biggest increase in transactions last year, as sales jumped 94.5pc in 2014, according to new analysis from property agents Hamptons International.
The number of sales rocketed 128 to 249 over the year and house prices grew 21.1pc, double the rate of the national average.
In the Hamptons 2014 index of British postcodes by transaction volumes, neighbouring Redcliffe in Bristol city centre came second with sales up 93.2pc last year.
The surge in transaction levels was driven by a growing demand to live in Bristol, one of the UK’s leading tech scenes, a relatively large number of new-build developments and high use of the Government’s Help to Buy scheme.
Other hotspots, measured by the rise in the number of sales, included Langdon Hills in Basildon, Essex, which came third in the ranking, while parts of Leicestershire, Cambridgeshire and North Dorset recorded huge jumps in transaction levels.
Cardiff also featured in the top ten according to the research, which only studied postcode districts in which there were more than 100 sales in 2013.
“What this really shows is Help to Buy working outside London,” said Henry Pryor, an independent property buyer.
While some of the data is skewed by high levels of Help to Buy utilisation, the usual suspects such as postcodes within Greenwich, Croydon and Dartford all reported a spike in sales too, landing in the top 20 areas by increase in home sales in 2014.
These boroughs on the outskirts of London have benefited from a wave of people cashing in on high house prices in the central boroughs and moving out, or first-time buyers purchasing in Croydon rather than Clapham due to the high prices in zones one to three.
Despite frenetic house price growth in areas such as Greater London last year, talk of a British house-price bubble was dismissed as overall transaction levels, which grew 14pc in 2014, still sat some 300,000 sales below pre-recessionary highs.
However, these localised areas of booming transactions are set for further property price rises, according to Hamptons.
Johnny Morris, head of research for Hamptons, said: “Whilst we’re often fixated with house prices, transactions tend to be a much better measure of market health than prices. Low activity impacts market liquidity, making the housing market less flexible. This drags on labour mobility and can cause price distortions.
“Jumps in transaction numbers in local markets can also be a leading indicator for price growth. It tends to be a sign of demand increasing in the market and some return to normalcy. Given many housing markets in the UK are supply-constrained, this will often ultimately translate into house price growth.”
At a regional level, transaction activity in 2014 grew most in the East Midlands, North West and West Midlands, all areas that saw significantly less price growth than the 6.7pc national average.
London, which experienced the highest house price growth, saw the least growth in sales numbers. This bodes well for the performance of housing markets in the Midlands and North West over 2015, Mr Morris said.