Average property prices fell slightly during August, dropping yearly house price growth down to 5%, according to the latest data released by haart.
House price values slipped by 1.9% during the month, meaning that the average UK house price is now £228,831.
Results from the report show that new buyer demand fell by 3.8% in August, and by a substantial 13.2% year-on-year.
What’s more, the number of new properties coming on the market has slipped by 4.4% month on month, but has actually risen by 5.2% annually. However, due to the fall in August, there are now nine potential buyers for every property coming onto the market in the UK.
Data from the report suggests that the market has become more efficient over the last month, with the number of transactions increasing but viewings falling. This means that buyers are choosing to look at less properties before making a purchase.
In London, the average property price has slipped by 3.4% during the last month, but this is 2.7% greater than last year. This is lower than the annual rate of growth seen across the rest of the UK. In addition, demand for properties in the capital has also fallen by 6.1% month-on-month and by a significant 25.5% year-on-year.
During the same period, the numbers of properties for sale has decreased by 5.2% but are up 1.9% year-on-year.
Tenant numbers entering the market have slipped 10.7% month-on-month and by 26.6% year-on-year. In turn, this has pushed down rents, which are now £1,353 on average.
In London however, the market remains steady, with demand rising by 0.7% on the month, but dropping by 23.3% annually.
Landlords are still leaving the sector as a result of the tax changes impacting on them earlier this year. London particularly has seen the brunt of the problem, with numbers of people registering down by 13.4% month on month and by a staggering 59.8% annually. This is in comparison to national falls of 5.3% and 52.2% year-on-year.
Property prices slide slightly in August
Paul Smith, CEO of haart, noted: ‘this month sees a property market that is still suffering from the Brexit blues. House prices are down, but are not out-as we near the bottom of the post-Brexit dip, with interest rate falls likely to help pick things back up again in the second half of the year. It is positive to see that transactions are still up for the second month in a row, so there is still plenty of activity in the market. We are also seeing a more positive picture for first-time buyers, as mortgage rates decrease, along with deposit and purchase prices, making it a good time to buy.’
‘What has become most apparent is that for London, the rise in the SDLT earlier this year has had a more profound impact on the market than Brexit has, as we see buy-to-let landlords continue to venture out of the capital and into regions where they are now more likely to see more lucrative returns on their investment. However, the continued lack of supply will always hold the market up in our resilient capital, and this is unlikely to see a too damaging effect long-term,’ he continued.
Concluding, he said, ‘the pound is continuing to recover week on week and broader business confidence data from YouGov shows the largest month on month jump in confidence in over 3 years – it’s too soon to say we’re ‘over’ Brexit, but the fog of uncertainty is beginning to clear. This boost in confidence should be reflected in property activity in the coming months as we return to relative normality. With the summer lull coming to an end, expect to see the market moving onwards and upwards in the autumn.’