According to the latest data by the lender Halifax the UK property Market is looking resilient to the storm of Brexit. The average price of property in the UK is now £236,800, a rise of 2.8% since February 2018.
In February alone prices increased by 5.9% and compared to Q4 of 2018 the average has increased by 1.8%. These figures point to a more resilient start of year to the market than was previously anticipated, especially with Brexit around the corner.
As pointed out by Russell Galley, Halifax managing director, house prices have grown on across the last year, quarter and months for the first time since October 2018. He believes that it is the shortage of supply that is supporting growth.
However it is worth noting that whilst the annual growth of 2.8% is within expectations, compared to the boom that occurred in 2015 and 2016 of 8.3% growth the figures are still relatively subdued, showing that bBrexit is still casting a shadow.
Russell also added:‘People are still facing challenges in raising a deposit which means we continue to expect subdued price growth for the time being. However, the number of sales in January was right on the five year average and, at over 100,000 for the fifth consecutive month, the overall resilience of the market is still evident,’
However whilst the figures look positive the fact that many buyers are adopting a wait and see approach and holding off to sell or buy may not be a good sign. The tightening in the market may also explain the recent rise in property prices.
‘Buyers, particularly those looking to get on the ladder for the first time, shouldn’t be put off by rising prices. There are still good offers to be had in some areas of the country. Potential buyers who are concerned about the economic impact of Brexit should also be considering their own current and future circumstances when it comes to mortgaging. Opting for a fixed-rate mortgage may give provide more stability as they’ll know how much their payments are each month,’ she said.
According to Sam Mitchell, chief executive officer of online estate agents Housesimple, Brexit will be the test for the housing market. ‘Even with an acceptable exit deal in place, house prices are likely to face some heavy turbulence. But it’s nothing the property market can’t take in its stride,’ he said.
‘We can’t say with any degree of certainty how buyers and sellers are going to respond over the coming weeks, especially if a no-deal becomes the most likely outcome. There’s some evidence to suggest that sellers and buyers have already decided to wait, particularly in and around London,’ he explained.
‘Far too much has been made of stalling price growth in the capital and the part Brexit has played, when in fact London was already showing signs of running out of steam well before politicians started squabbling around the Brexit table. The danger is that stuttering house price growth in London sets the tone for the whole country,’ he explained.
‘And the strength of regional property markets in the north, buoyed by strong first time buyer and investor numbers, is an encouraging sign that the performance of the UK’s housing market is not determined by what’s happening within the M25,’ he added.