Property market flat as house sales stagnate
Halifax predicts strong employment and cheap mortgages will help annual prices rise up to 3pc
HOUSE price growth in Britain remains flat, with prices 1.8pc higher in the three months to June than during the same period a year earlier, marginally lower than the 1.9pc annual growth recorded in May. Halifax’s house price index found that while the job market had strengthened, easing the pressure on household finances, mortgage approvals had been in the low range of 63,000 to 67,000 since the start of the year, with home sales stagnating.
Nevertheless, Russell Galley, managing director of Halifax, said the lender continued to see “very positive factors” in the housing market, of continuing low mortgage rates, good affordability levels and a robust labour market. “The continuing shortage of properties for sale should also continue to support price growth,” he added.
Halifax’s growth forecasts for 2018 remain in the 0pc to 3pc range, it said. The average property price is now £225,654, up from £217,620 in June 2017.
Despite gloomy forecasts at the beginning of the year, and fears of a mar- ket crash, Russell Quirk, founder and chief executive of online estate agent Emoov.co.uk, said that, while the UK market may have “come off the boil slightly” where house price growth is concerned, property values are still up annually. He noted supply levels remain subdued and continue to be exceeded by buyer demand as a result of mortgage affordability. “These are not the ingredients for a market crash and it is highly unlikely that we will see anything other than stable growth and an uplift in market activity throughout the remainder of the year,” he said.
Nationwide’s house price index, published last week, found that annual price growth in Britain had fallen to a five-year low, as a result of continued subdued levels of new buyer inquiries and a lack of properties available on the market.
Robert Gardner, Nationwide’s chief economist, said that growth had been “confined to a fairly narrow range” of about 2pc to 3pc over the past 12 months, suggesting “little change in the balance between demand and supply in the market over that period”.
He continued: “There are few signs of an imminent change. Surveyors continue to report subdued levels of new buyer inquiries, while the supply of properties on the market remains more of a trickle than a torrent.”
The UK housing market has slowed since the EU referendum in 2016, and many economists have predicted growth could flatline this year.