Over the past two years, there has been a slowdown in UK house price growth, driven mainly by a slowdown in the south and east of England.
The lowest annual growth was in London, where prices fell by 0.7% over the year to November 2018, unchanged from October 2018.
The report shows that the average UK house price was £231,000 in November 2018. This is £7,000 higher than in November 2017. On a non-seasonally adjusted basis, average house prices in the UK fell by 0.1% between October 2018 and November 2018, compared with a decrease of 0.3% in average prices during the same period a year earlier (October 2017 and November 2017). On a seasonally adjusted basis, average house prices in the UK increased by 0.1% between October 2018 and November 2018.
England house price growth weaker than rest of UK
House prices in England grew slower than other countries of the UK, increasing by 2.6% in the year to November 2018, up from 2.3% in the year to October 2018, with the average price in England now £247,000. House prices in Wales increased by 5.5% over the last 12 months to reach £161,000. In Scotland, the average price increased by 2.9% over the year to stand at £151,000. The average house price in Northern Ireland currently stands at £135,000, an increase of 4.8% over the year to Quarter 3.
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: "Although the most comprehensive snapshot of UK house prices, these numbers are a little historic and illustrate what was happening in the autumn. They confirm that price falls in London are masking some resilience elsewhere in the UK and that transaction numbers are holding up reasonably well. However, they don’t reflect the recent Brexit uncertainty.
On the ground, we are finding that we are in a price-sensitive, needs-driven market, especially at this time of year, which continues to be underpinned by low mortgage and unemployment rates, improving affordability and stock shortages. As a result, we recorded better-than-expected viewings and valuations in early January, despite the Brexit uncertainty.
On the one hand, the risk of uncertainty for the property market increases after yesterday’s vote but on the other, it helps to concentrate minds on all sides as the threat of a ’no deal’ rises, which was reflected in Sterling’s strengthening immediately after the result was announced.'
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: "Several lenders, including Barclays and HSBC, have reduced their mortgage rates recently on the back of falling Swap rates as they attempt to get business off to a strong start to the year. More lenders are likely to follow suit as funding costs remain low and there is a limited number of potential borrowers out there, as many people put decisions on hold until the Brexit outcome becomes more certain.
Lenders are likely to continue to chase market share although we may see some pressure on the pricing of high loan-to-value products in light of the ongoing uncertainty. Borrowers needing a mortgage in the next six months may want to consider securing a product now, just in case rates do rise. You can always review this when it comes to switching deals and opt for another if rates have fallen further. But it might be good to have a fixed-rate deal lined up as security, given that the situation is so uncertain."
Mark Readings, founder and Managing Director of online estate agency, House Network, had this to say: "The latest report reconfirms the situation in the UK, which has seen the property market overshadowed by a continuation of uncertainty since the vote to leave the EU. After PM Theresa May's huge defeat yesterday evening, it is clear that the political uncertainty is not going to be stabilised as quickly as was first hoped. This defeat will now force many individuals who are on the fence and waiting for clarity over Brexit to now reconsider the market wait." - Says Mark Readings.
We may begin to see some movement in the property market over the next 6 months, as those wishing to sell are no longer able to wait out the Brexit limbo and first-time buyers take advantage of the uncertainty, gaining some respite from previous rapidly rising house prices."
John Goodall, CEO and co-founder of Landbay, said: “These figures are likely to be a slight reprieve for ‘Brexit-ed’ out homeowners, unable to face more uncertainty-linked price turbulence. Looking into the detail, rising prices in the north have helped bridge some of the gap between those in London. Homeowners in the capital have been impacted by the upper stamp duty threshold, limiting their ability to move.
There’s no escaping the fact that confidence in the market is low, bogged down by Brexit and economic uncertainty. However, these figures point to an opportunity for those in a position to buy. The combination of low prices, solid wage growth and attractive borrowing costs often proves to be too difficult to resist.
Kevin Roberts, Director, Legal & General Mortgage Club, comments: “The ongoing political uncertainty is clearly causing some buyers and sellers to take a wait-and-see approach when it comes to the property market. But a combination of low interest rates and the slowing house price growth we are seeing today should act as a catalyst to encouraging buyers to take action.
Buyers who are unsure of where to begin this process will find that speaking to an independent mortgage adviser can be hugely beneficial. These experienced individuals can provide bespoke advice, access to mortgage products that aren’t available direct from a lender and help would-be homeowners understand the different options available. This could include Government Schemes such as Help to Buy and Shared Ownership, high LTV mortgages or family assist mortgages, to ensure they find the right solution for their needs.”
Paul Telford, Director of home seller empowerment platform, OkayLah, commented: “The continued debacle that surrounds our European departure will do little to stabilise the current turmoil of the UK property market. Both home sellers and buyers will be unsure whether they are coming or going in the current market climate and this hesitation will no doubt see transactions drop and price growth follow suit for the short term at least.
While the estate agency sector itself has suffered as a result of this lethargic market activity, there remains an appetite for homeownership and although Theresa May’s deal may have failed to materialise the UK property market is far from Brextinction.
For those still intent on buying or selling, a sale can be achieved but now more than ever it requires comprehensive market research, a realistic asking price on entering the market and a little perseverance and patience during the latter stages of a sale.
Those that arm themselves appropriately with the knowledge to do so will find there is life outside of Westminster, as the world keeps turning and people keep on moving.”
