In the UK the average house price increased by 1.3% in August compared to July, with the strongest growth remaining in Wales at 4.5%.
London showed a drop in the average house price, where they fell by 1.4%, while elsewhere in England the North East and North West continue to have strong price increases, as highlighted in our Northern Property Report in September (link to northern property update blog from Gavin Elley).
The number of first-time buyers has reached its highest since August 2007. This is likely to be driven by a combination of factors, including the low-interest rates currently available, competitively priced houses, changes in stamp duty and the impending end of the Help-to-Buy scheme.
Autumn is traditionally a time to see an upward trend in the housing market with the completion of summer sales and the rush to get in before Christmas. While there has been an upturn, it is not as large as the usual seasonal trend. The September RICS report indicated that the housing market had remained slow for 2019 and suggested that this trend was likely to continue until the new year. With ongoing Brexit uncertainty and now a general election on the horizon, it’s not surprising that both sellers and purchasers are cautious about entering the market at this current time. However, we remain optimistic that the housing market in 2020 will see more positive movement than the previous few years.
In the buy to let market, RICS commented that demand for rented property continued to outstrip supply. This growth has continued for the previous 8 months and the outcome, together with a decline in supply, is that rental cost will continue to increase over the next 3 months. It is estimated that rents will increase by 2% over the next 12 months and the longer 5-year forecast expects increases of approximately 3% each year.
While some have suggested that the buy to let market is not worth it for the landlords anymore, we would be inclined to disagree. With house prices increases easing off, continued growth in rental demand and rent prices, plus cheaper mortgage products, we would say now is a great time for landlords.
Autumn Report. Data has been sourced from UK Finance, Rightmove, RICS, Bank of England and HM Land Registry