UK house prices grew at their slowest annual rate in six years in September, a closely-watched gauge has revealed, as Brexit uncertainty continues to smother activity in the sector.
House prices grew by just 1.1 per cent over the last year, undershooting economists’ expectations of a rise of 1.6 per cent, Halifax’s house price index showed today. Prices rose at an annual rate of 1.8 per cent in August.
Month on month, UK house prices fell by 0.4 per cent in September, down from 0.2 per cent growth in August. The monthly figure also dropped below economists’ expectations of a 0.1 per cent rise.
Russell Galley, managing director of Halifax, said that although the 1.1 per cent annual growth is the lowest since April 2013, it “remains in keeping with the predominantly flat trend we’ve seen in recent months”.
“Underlying market indicators, including completed sales and mortgages approvals, continue to be broadly stable. Meanwhile for buyers, important affordability measures – such as wage growth and interest rates – still look favourable.”
“Looking ahead, we expect activity levels and price growth to remain subdued while the current period of economic uncertainty persists.”
Housing is just one market that has been subdued by political uncertainty in Britain. Potential buyers and sellers are putting off their decisions until there is more clarity over Brexit.
Halifax said today that recent surveys show a flatter trend in demand and lower mortgage approvals in recent months.
The UK housing market has also been hit by a global economic slowdown that has weighed on asset prices. First-time buyers will be cheered by the news that houses are not rocketing in price, however.
Andrew Montlake, managing director of UK-wide mortgage broker Coreco, said: “As we approach Halloween and the Brexit endgame it’s no surprise price growth is slowing, but the horror show many predicted hasn’t played out.”
“Extremely low borrowing costs continue to make property affordable while the strength of the jobs market is giving people confidence amid the chaos.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, said low levels of activity was forcing mortgage lenders to “work incredibly hard to generate business and stand out from the competition”.
“This is excellent news for borrowers and once buyers return to the market, when the uncertainty is removed from the equation, there are some extremely competitive products for them to take advantage of.”
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