Financial gap between London and rest of UK to ’shrink’

The financial gap between south-east England and the rest of the country is set to shrink by 2015, a new study reveals.

According to research by SG Hambros, rising property prices and wage increases across Britain could mean the wealth difference could decrease "significantly" within the next eight years as businesses look to move away from London, reports the BBC.

Deputy managing director of SG Hambros Phil McIlwraith told the broadcaster: "Rising costs have led to a number of firms establishing their bases away from the capital."

The report also claimed the north-west of England is to become one of the key areas set to see a rise in wealth, with house prices in the north-east set to rise the fastest.

SG Hambros added that while the findings are "good news for homeowners in the north-east of England", prospects in Wales and Northern Ireland are set to be "bleak".

According to a study by Hometrack, property in England and Wales rose by an average of 0.7 per cent, about £1,200, during February - the largest monthly increase since May 2004.

The findings revealed that although 42 per cent of all homes saw price increases, these were mainly concentrated in the south, particularly in the areas just outside of London.

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