Friday, June 25, 2021
UK

UK house price growth stays subdued

house price growth

UK house prices continue to see slow growth as the annual price increase was less than 1% for the fifth month in a row, according to Nationwide’s report

Annual house price growth in the U.K. remained subtle last month, with prices 0.9% higher than last April, according to Nationwide’s April report on house price index.

This was the fifth straight month in which annual price growth was less than 1%, the British bank and mortgage lender reported.

The average house price in the U.K. is now £214,920 (US$281,248), which, after seasonal adjustment, is 0.4% higher than March.

Nationwide’s chief economist, Robert Gardner said measures of consumer confidence decreased in the beginning of the year, but market activity, such as number of property transactions and approved mortgages, have remained mostly stable.

While the number of properties coming onto the market has also slowed, this doesn’t appear to have been enough to prevent a modest shift in the balance of supply and demand in favor of buyers in recent months, he said in the report.

Despite “ongoing economic uncertainties,” Nationwide reported that first-time buyers continue to steadily enter the housing market in the U.K.

The number of mortgages taken out by first-time buyers is now above 350,000, approaching pre-recession levels. According to a U.K. Finance chart in Nationwide’s report, there were about 400,000 first-time mortgages in 2007. The chart reports a 12 million running total.

First-time buyer numbers have been supported by the strength of labor market conditions, with employment rising at a healthy rate and earnings growth slowly gathering momentum, Gardner said in the report.

In 2018, first-time buyers’ incomes were, on average, about the same or below their region’s average earnings, aside from London, the South East and the East, where first-time buyers’ incomes were significantly higher than average. Specifically, the average income of London’s first-time buyers was 60% higher than the average full-time income in London.

Garder said this shows how many potential buyers have been priced out of these three areas. According to the report, London and parts of Southern England were the only areas during the fourth quarter with mortgage payments that were a higher percentage of first-time buyers’ take-home income than the long-run average.

Important:

The articles are for information purposes only and Invest for Property shall not be held responsible for any errors, omissions or inaccuracies within it. Any rules or regulations mentioned within the website are those relevant at the time of publication and may not be the most up-to-date.

Invest for Property does not endorse any of the products or services that appear on it or are linked to it and are not liable for any action that you may take as a result of the content of this website, or losses or damage you may incur doing so.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Please remember that investments of any type may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

Leave a Reply

four × four =