UK housing market

UK housing market has become 'noticeably darker'



UK annual house price growth in October was at its lowest level since May 2013, according to recent research.

The latest Nationwide house price index revealed that annual house price growth slowed to 1.6% in October, down from the 2% reported in September.

The average house price in October was £214,534, a slight fall on the £214,922 recorded a month earlier.

Commenting on the slowdown to 1.6%, Robert Gardner, chief economist at Nationwide Building Society, said: “As a result, annual house price growth moved below the narrow range of [around] 2-3% prevailing over the previous 12 months.

“However, this was broadly in line with our expectations, as the squeeze on household budgets and the uncertain economic outlook is likely to have dampened demand, even though borrowing costs remain low by historic standards and unemployment is at 40-year lows.

“We continue to expect house prices to rise by around 1% over the course of 2018.

“Looking further ahead, much will depend on how broader economic conditions evolve.”

Jonathan Samuels, CEO at Octane Capital, felt the property market appeared to have gone back like the clocks.

“October was the month things got noticeably darker on the house price front.

“Brexit is drawing ever closer and the great unknown it represents is undermining confidence and dragging on transaction levels.

“A robust jobs market and continued low borrowing rates are preventing an outright collapse, despite high living costs and interest rate uncertainty.”

Jonathan Hopper, managing director at Garrington Property Finders, added: “The property market may have dodged another stamp duty bullet in Monday’s Budget, but in many areas it remains caught in the crosshairs of weak confidence and stagnating prices.

“The South East’s slowdown is starting to spread to a few other regions, but the lion’s share of the blame for the increasingly glacial pace of national price growth lies with the falls seen in London.

“The prime central areas that were once the capital's property powerhouse remain sluggish at best, slumbering at worst.”

Ross Boyd, founder of mortgage platform Dashly, said the with growing levels of uncertainty, price growth in October had flatlined, pulling the annual growth rate down with it.

“As we enter the business end of Brexit, households are getting ever more apprehensive and this is now materially affecting demand.

“After the brutal tax changes of recent years, the nightmare for landlords is proving particularly protracted.

“It’s hard to see the property market emerging from its current stasis until well into 2019 once there is more clarity on where the economy is at.”

 


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