According to a report from popular high-street lenders Halifax, house prices in the UK had edged ahead by the end of the summer with the property market showing a degree of resilience despite the political uncertainty that continues to hang over the country.
Halifax have revealed that the average house price rose by 0.3% month-on-month, taking the annual rate of house price inflation to 1.8%. Meanwhile, Berkeley, a leading skyscraper developer in London, said that it has enjoyed a period of robust market conditions within the capital city and across the local region. The developers are currently in the middle of building London’s second tallest residential development - a 68-storey building in South Quay Plaza, Canary Wharf - where apartment prices reach £2m and beyond.
Political uncertainty surrounding the UK with the Brexit ordeal has been viewed as the main cause of falling prices in the London market, but the Berkeley Group state that a trading update has revealed that prices have remained stable on the whole and there is a strong demand for new homes despite what they describe as “uncertainty in the macro-political and economic environment”.
The report from Halifax claims that the average price of a new property in the UK has risen to £233,541, which is a close to £4,000 increase when compared to the same period last year. Halifax say that the property market is currently supported by strong employment levels across the UK, coupled with a general shortage of homes for sale.
Russell Galley, managing director at Halifax, says that despite ongoing economic uncertainty continuing to weigh on consumer sentiment, with both buyers and sellers alike remaining cautious, important underlying factors such as affordability and employment remains strong.
Galley states that he expects the housing market to undoubtedly be influenced by events that take place in the wider economy, but at the moment the market does appear to be showing a degree of resilience. He also highlights the importance of remembering the fact that the single biggest driver of house prices and activity over a long period of time remains the shortfall of available properties to meet the demand from property buyers.
Recently, Barratt Homes posted a record £910m profit despite what many industry experts claim to be a tough property market. The introduction of the UK government’s help-to-buy scheme has been a big part of the company’s success, with 40% of sales attributed to the scheme, but they have also been widely criticised for inflating prices.
Barratt have confirmed that the new-build housing market has been incredibly resilient in recent times, with no reduction in first-time buyer interest despite the increasing threat of a no-deal Brexit.
Some property experts still remain less convinced, claiming political upheavals are sure to knock confidence. Some say that although Halifax figures are relatively positive and demonstrate the appeal of homeownership in the UK, the volatile political events may soon change the sentiments of buyers and sellers, especially if predictions of an economic downturn prove to be correct.
One positive outcome for buyers could be renewed falls in mortgage interest rates. Recently, HSBC suggested an extra £35bn is to be made available for lending in the UK residential mortgage market, with two-year fixes widely available at interest rates of around 1.25% and five-year deals below 1.7%.
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