Average house prices in the UK up by just 1.3% in year to August 2019
Average house prices increased by 0.8% month on month in August 2019 and by 1.3% year on year to £234,853, according to the latest official index data.
In England prices rose by 0.8% on a monthly basis and by 1.1% on an annual basis to £251,233, in Wales they were up by 2.2% month on month and 4.5% year on year to £168,318 while in Scotland they were up 1.6% year on year and Northern Ireland up by 3.5% in the 12 months to June 2019.
A regional breakdown of the figures from the Office for National Statistics (ONS) show that the North East recorded the biggest monthly price rise at 3.1% while London saw the most significant monthly price fall of 1.3%.
The North East experienced the greatest annual price rise, up by 3.3%, and London saw the largest annual price fall, down by 1.4%. London shows, on average, house prices have fallen by 1.3% since July 2019. An annual price fall of 1.4% takes the average property value to £472,753.
Mike Scott, chief property analyst at full-service estate agent Yopa, pointed out that the official Government house price largely relate to sales agreed in April, just after the Brexit deadline was extended and the looming threat of a no-deal Brexit was postponed.
‘We expect that this index will now remain relatively flat for the rest of the year, since even the December figures, which won’t be published until February next year, will only relate to sales that were agreed before the new Brexit deadline really starts to bite,’ he said.
‘It should therefore end the year where it is now, with average prices up by around 1%. However, London and South East England are likely to fall further, since their prices are still looking overheated when compared with average earnings in those regions, and with prices in the rest of the country,’ he added.
According to Sam Mitchell, chief executive officer of Housesimple, price growth in the UK has suffered amid the ongoing uncertainty and political turmoil of Brexit. ‘But the property market has been tested before, and time and time again it has proved its resilience. History has a habit of repeating itself and we mustn’t overlook that. Today’s ONS figures that show a month on month rise in house price figures are a testament to this,’ he explained.
‘Ultimately, strong economic fundamentals have been and will continue to offset headwinds with low mortgage interest rates, good mortgage availability and wage growth all remaining positives for buyers,’ he said.
‘Those sat on the fence about selling before 31 October, or immediately after, should not be deterred. There are numerous factors that lead to someone buying a house, and regardless of the UK being in or out of the European Union, people will still be looking to move up the property ladder,’ he pointed out.
‘As speculation around the Autumn Budget begins to build, it is essential that the government doesn’t lose focus on supporting buyers and makes good on its promises of stamp duty changes. Whatever policy they choose, both buyers and sellers are tired of waiting around and it is time for some clarity,’ he added.
Jeremy Leaf, north London estate agent and former RICS residential chairman, pointed out that these figures are the most comprehensive snapshot of the UK property market of all the surveys. ‘They show a small rebound from last month’s very weak numbers as the monthly and annual increase in prices are higher than the previous results,’ he said.
‘Sadly, this is nothing to get too excited about because the market remains relatively flat although of course the resilience is welcome, continuing to be reinforced by improving affordability and near record-low mortgage rates as buyers and sellers look beyond Brexit. It is worth noting that a national average masks what is happening in local markets evidenced by the fall in prices in London by 1.4% over the year compared with almost the whole of the rest of the country,’ he added.