The latest figures from Halifax shows that UK house prices increased by 5.2% in the 12 months to May 2019.
This represents the highest annual growth for a year, increasing the UK average house price to £237,837. Furthermore, house prices have risen by 2.5% compared to the last quarter.
Russell Galley, managing director at Halifax, believes that whilst political uncertainty has made buyers and sellers cautious, factors such as employment and record low-interest rates have maintained stability for the UK property market.
“We saw a slight increase in house prices between April and May, but the overall message is one of stability. Despite the ongoing political and economic uncertainty, underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low-interest rates.”
“This is supported by industry-wide figures which suggest no real change in the number of homes being sold month to month, while Bank of England data shows the number of mortgages being approved rose by almost 6% in April, reversing the softness seen in the previous month.”
For first-time buyers, who remain employed, have continued to take advantage of competitive mortgage deals and low-interest rates, with over 65,000 applications approved for May. However, Galley remains cautious at the long-term implications that Brexit may have for homeowners looking to sell. Read more.
“While current conditions may help those looking to make their first move onto the property ladder, existing homeowners will doubtless be considering long term house price growth which continues to look subdued in comparison to recent years.”
“Looking ahead, we expect the current trend of stability based on high employment and low-interest rates to persist over the coming months, though clearly any downturn in the wider economy would be keenly felt in the housing market.”
These factors have led to property developers thinking about the type of buyers who are looking to get onto the property ladder. Counties such as Essex are continuing to welcome professional London workers who are looking for an affordable home with strong commuting ties to the capital.
Recent figures published by Halifax have been well-received by Marc von Grundherr, director of agents Benham and Reeves. He believes that there are a number of positive aspects that are helping the property market strive despite political uncertainty.
“High employment and steady wage growth are bringing an overarching air of stability to the market, subdued house price growth and low interests rates are giving first-time buyers an additional leg up. But we’ve also seen the largest rate of annual house price growth in the last year which is positive for existing homeowners.”
Although the Brexit deadline has been pushed back to late October, prospective home buyers and first-time buyers have decided to continue with their housing plans and ambitions.
Tomer Aboody, director of property lender MT Finance, believes that the signs of recovery and confidence are being driven by those who are tired with the impending deadline.
“Buyers have come to the conclusion that enough is enough, and the uncertain conditions which have been facing them could carry on for a while still, so that shouldn’t hold them back from getting on the ladder or moving up or down it.”
As house prices in the country begin to slowly increase, first-time buyers are looking to take advantage of the current marketing situation. If you’re a property developer, there are a number of hotspots around key places such as London. Where are family home-buyers looking?