The residential property market has demonstrated its significance for property investment UK as house prices across the country bounced back in November after a slowdown that spanned several months. This follows the previous high reached in February earlier this year.
House prices across the UK were 2.1 per cent higher last month then they were a year ago, according to the Halifax House Price Index.
Prices also grew on a monthly basis, rising 1.0 per cent from October, ending the back-to-back decline in growth seen over the past few months.
This has strengthened the case for property investment UK as the market may see more investors putting money into the market. As the UK faces an undersupply of available properties, a rise in investment and number of new properties will be a step towards resolving the housing crisis.
House prices are now £3,904 more expensive than they were at the start of the year. In fact, the average house price is now the highest this year, surpassing the previous high of February’s £234,195, the highest average property price since Halifax began collecting data.
UK house prices also posted quarterly gains, with the latest quarter, including September, October and November, 0.2 per cent up on the preceding three months.
Russell Galley, Managing Director, Halifax, said: “Prices are now up by £3,904 since the start of the year. While a degree of uncertainty remains evident, it’s also clear that buyers and sellers are responding to factors such as improved mortgage affordability and the limited supply of available properties.
“It is these issues which we believe will continue to underpin the resilience evident in the market for most of 2019. Over the medium term we expect the emerging trend of modest gains to continue into next year.”
After two consecutive months of declines, the increase may improve the sentiment for property owners ahead of next week’s general election. The property sector was subdued since the announcement of General Elections as property owners preferred to wait till the elections were over. But the latest data from the mortgage lender comes across as a good news for property owners across the UK. Moreover, a clear election result may further boost the typical New Year surge.
Halifax said on Friday that the figures were further evidence of the “resilience” of the UK property market.
The new data comes after government figures showed a rise in residential property sales in October.
On a seasonally adjusted basis, there were 103,680 transactions in October, a 4.3% climb on September and the highest level since July 2017.
The firmer Halifax house price data follows Nationwide’s report of a 0.5 per cent month-on-month rise in property prices last month, marking the biggest hike on its measure since July 2018.
“November’s pick-up in house prices comes despite housing market activity currently faltering amid an unappetising cocktail of Brexit, economic and domestic political uncertainties”, Howard Archer, chief economist at the EY Item Club, said.
However, others cautioned against too much optimism, particularly as RICS residential market data showed that new buyer enquiries fell for the second consecutive month in October. Agreed sales also fell.
According to the recent data from HM Revenue & Customs, there were 103,680 residential house sales in October, marking a 4.3 per cent increase from September and the highest rate since July 2017.
In terms of mortgages approvals, 64,602 residential mortgages were secured in October, which is 1.8 per cent lower than in September, HM Revenue & Customs said.
The increase in annual growth seen in the London has “started to bubble away again”, says Lucy Pendleton, founder director of independent estate agents James Pendleton.
She said, “In the capital, a big jump in the number of sales going to best-and-final offers is going hand in hand with increasing footfall through front doors as buyers’ appetites return”.
As London typically drives the property market across the country, the current rise in house prices should be an indicator of what is to follow across the rest of the UK.
Therefore, it seems to be worth investing in the UK property market as it is a stable market which may experience some slowdowns at times. In fact, the slowdowns are part of the cycle and a good opportunity for property investment UK. Since property investment is a long-term investment, the advantage lies in holding a property for a few years. Barring the downtimes, which may last from a few months to a few years, property investment UK is a safe option which promises good returns.
The UK, and London, in particular, is known for its stable and resilient property sector and property investment UK offers the perfect opportunity for widening the investment base. Property investment UK is also lucrative since it acts as a safe haven for property investors in the current times of economic instability. Property investment UK is an attractive option for the overseas-based investors as the current economic climate across the globe goes through a period of uncertainty. The ongoing trade and tariff wars are having a deep impact on the global economy, resulting in losses worth billions of pounds, leaving property investment UK as a secure option to keep money.
As the value of property mostly appreciates over time, it offers a good opportunity to benefit from property investment UK. By adopting a smart exit strategy, and selling at the right time, investors can derive the maximum value out of property investment UK. However, a number of factors should be considered in order to generate a high return out of property investment UK. These include choosing the right property, place and time of purchase. It requires skills, knowledge and experience in order to become a successful property investor. Such an investor knows the right place and time to buy a property, which may decide the outcome of the investment. Although for the first time buyers, the current rise in house prices may not be a welcome news, as they are already struggling to get a foot on the property ladder. However, first time buyers can avail cheaper options to begin their home ownership journey.
This article is for information purposes only.
Please remember that financial investments 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.
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.