House price growth slows to low­est level in six years

The Independent - - Business - CAITLIN MOR­RI­SON

UK house price growth in Novem­ber marked the low­est rate recorded in six years, ac­cord­ing to the lat­est Hal­i­fax House Price In­dex.

Prop­erty prices in the three months from Septem­ber to Novem­ber fell 1.1 per cent com­pared with the pre­ced­ing quar­ter, while prices dropped 1.4 per cent be­tween Oc­to­ber and Novem­ber.

Mean­while, the rate of growth dropped to 0.3 per cent, the low­est rate since De­cem­ber 2012.

Rus­sell Gal­ley, man­ag­ing di­rec­tor at Hal­i­fax, said: “High em­ploy­ment, wage growth and his­tor­i­cally low mort­gage rates con­tinue to make home own­er­ship more af­ford­able for many, though the need to raise a

sig­nif­i­cant deposit still acts as some­thing of a re­straint on the mar­ket. This is largely off­set by rel­a­tively lim­ited sup­ply of new and ex­ist­ing prop­er­ties for sale, which con­tin­ues to sus­tain house prices na­tion­ally.”

A num­ber of prop­erty ex­perts said con­tin­ued un­cer­tainty around Brexit was weigh­ing on the mar­ket, with peo­ple un­will­ing to make de­ci­sions on prop­erty pur­chases while the fu­ture of the coun­try’s econ­omy is still un­clear.

Mike Scott, chief prop­erty an­a­lyst at es­tate agent Yopa, said: “The usual Christ­mas slow­down in the hous­ing mar­ket has started early this year, as peo­ple wait for the out­come of the cur­rent po­lit­i­cal tur­moil be­fore mak­ing long-term com­mit­ments, such as buy­ing a new home.”

Jeremy Leaf, a north Lon­don es­tate agent and a for­mer res­i­den­tial chair­man of the Royal In­sti­tu­tion of Char­tered Sur­vey­ors, said: “Look­ing for­ward, we don’t ex­pect ac­tiv­ity to change much, bear­ing in mind sea­sonal and po­lit­i­cal dis­trac­tions. On the ground, lethargy is re­plac­ing en­ergy.”

Gary Barker, chief ex­ec­u­tive of proptech com­pany Reapit, also pre­dicted a con­tin­u­a­tion of the cur­rent sub­dued per­for­mance.

“Trans­ac­tions have been flat for the past three years, and cau­tion is likely to re­main whilst Brexit re­mains un­fin­ished. Fur­ther­more, if Brexit stalls, or more sig­nif­i­cant un­cer­tainty over the gov­ern­ment de­vel­ops, it will be a painful road ahead,” he said.

Mr Barker said that there could be room for op­ti­mism: “We are see­ing house price re­duc­tion in some ar­eas, which could make prop­erty more af­ford­able and also boost the econ­omy by in­creas­ing spend­ing power and buy­ing ca­pac­ity. If the Brexit deal passes through par­lia­ment, we could po­ten­tially see a much more con­fi­dent mar­ket, re­sult­ing in more trans­ac­tions, fewer with­drawals, and in­creased prices.”

How­ever, he added: “If the Bank of Eng­land’s fore­cast of a 30 per cent drop in house prices comes to fruition fol­low­ing a no-deal Brexit, the bal­ance of the mar­ket will shift dra­mat­i­cally. Al­though trans­ac­tions may re­duce sig­nif­i­cantly, with de­pressed prices dis­cour­ag­ing sell­ers from list­ing their prop­er­ties, low prices will put buy­ers back in control. First-time buy­ers, in par­tic­u­lar, could ben­e­fit from slashed prices, giv­ing them a leg-up onto the prop­erty lad­der.”

Brexit un­cer­tainty hits the mar­ket as the fu­ture of the econ­omy re­mains un­clear (PA)

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