- UK house prices remain relatively stable, down by just 0.9% on the month in July, sitting at an average of £233,254
- UK transactions increase by a healthy 6.5% across the month despite post-Brexit uncertainty
- Number of new buyers entering the market increasing both across the whole of the UK and within London
- Buy-to-let landlords continue to retreat from the London market in the aftermath of the SDLT increase in April
Paul Smith, CEO of haart, the UK’s largest independent estate agent comments:
“Despite last month’s political turmoil, it seems buyers aren’t being deterred by the noise. We’ve actually seen a bounce in transactions in July, with a lot of buyers pressing ahead with their purchase now that the referendum is over. Prices have dropped slightly by 0.9% across the UK, and have fallen 5.6% in London, showing that sellers are cutting deals to bypass the uncertainty in the wider economy, and plucky buyers are taking advantage. Nevertheless, prices in London and across the UK both remain significantly higher than they were at the same time last year.
“Whilst there is certainly still some uncertainty in the property market and the wider economy, the announcement of a cut in interest rates will see the country’s cheapest ever mortgage rates falling even further, and it won’t be long before the market bounces back. The desire for people to own their own home or move up the ladder is as strong as ever, and we have every reason to be confident about the property market’s long-term prospects. The only thing we have to fear post-Brexit is fear itself.”
House prices in July have fallen slightly by 0.9%, pushing down annual house price growth for the UK to 7.3%. The average UK house price now sits at £233,254.
New buyer demand for homes has risen, by 2.7% on the month and 7.2% annually across the UK. Additionally, the number of new properties coming onto the market has risen 3.8% on the month and 23.2% on the year. With an increase in stock, the number of buyers chasing every instruction has fallen slightly, however there are still eight buyers for every new property that comes onto the market across the UK.
The market has become more efficient this quarter, as the number of transactions has increased but the number of viewings has fallen on the month, meaning buyers are having to look at fewer properties before they buy.
First-time buyer house prices have also risen by 0.9% on the month to an average of £175,596, as competition for starter homes rises. The number of new homes entering the market has risen 13% on the month and is 31% higher than at the same time last year.
As the average first-time buyer home price has increased, the average deposit has also risen, by 2.8% on the month and by 15.6% annually.
The average property price in London has declined 5.6% on the month, and is 2.5% higher than July last year. This is less than half the annual rate of growth seen in the rest of the UK. However demand for properties in London has increased by over 11% on both the month and year. At the same time, the number of properties for sale has increased by 2.2% monthly and a very healthy 19.7% annually. Sale transactions have also seen growth on the month of 10%, but have dropped 16% on an annual basis.
The Lettings Market
The number of tenants entering the market has fallen by 8.3% on the month, and by 4.3% annually, decreasing the rate of demand. This has pushed down rents marginally, as the average rent now sits at £1,547 across all of the UK. However it is a different story in London as demand continues to rise, by 36.2% on the month and 5.6% annually, but the average rent has marginally fallen by 1%, now sitting at £1,921.
We are continuing to see a number of landlords retreat from the market after the SDLT increase on additional properties, with numbers registering down -19.1% on the month and a dramatic -46.3% annually, and by -19.8% and -48.4% respectively in London. Despite the fall in demand, sale prices of buy to let properties saw a post-Brexit bounce, up 5.6% on the month across the UK and 9.9% in London. The number of transactions also saw a healthy increase on last month, but the number of transactions in London was down significantly on last year.