House Price Index

June 2019

Price of property coming to market within a whisker of new record

  • The price of newly-marketed property rises by an average of 0.3% (+£1,058) this month
  • New all-time price highs in East Midlands, North West, Wales and Yorkshire & the Humber push the national average to within £91 of a new record despite backdrop of political uncertainty
  • Market buoyancy in these regions also reflected in better performance for both new sellers coming to market and sales agreed compared to the national average annual change for the year so far
  • Sales agreed for the year so far holding up better in the northern regions, down by only 1.7% year-on-year, compared to 7.1% in the south indicating some hesitancy to engage in the market

Overview

The price of newly-marketed property rises by an average of 0.3% (+£1,058) this month. Four northern regions see their highest ever prices, pushing the national average price of property coming to market to within £91 of a new record despite the backdrop of political uncertainty.

Miles Shipside, Rightmove director and housing market analyst comments: “With the country supposedly consumed by the twists and turns of Brexit, it’s surprising that the price of property coming to market is within a whisker of setting a new record. At £91 below June 2018’s figure of £309,439, it’s within touching distance of the previous high. More buoyant markets in the north and midlands are helping to nudge up prices due to the seemingly relentless strength of buyer demand. Buyers in four regions are seeing higher new seller asking prices on average than ever before.”

The regions setting new all-time price highs are the East Midlands, the North West, Wales and Yorkshire & the Humber. These regions are also outperforming the national average in the key metrics of number of properties coming to market and the levels of sales agreed so far in 2019. At the mid-point of 2019 new seller supply remains constrained nationally, down by an average of 5.0% versus the same period in 2018.

Shipside notes: “The national trend sees new seller supply down by an average of 5% so far this year compared to the same time last year, indicating some hesitancy on the part of would-be sellers, especially notable in parts of the south. However, these better-performing northerly regions are all beating that national average. In the East Midlands, new seller supply is up by 0.3%, in Yorkshire & the Humber it’s down by just 0.2%, in Wales it’s fallen by 2.5% and in the North West it’s dropped off by 2.7%.”

This regional pattern is also evident in the number of sales being agreed, though again the more difficult national market backdrop has an effect. The more marked reluctance of would-be sellers in the south to come to market means less property choice for buyers and fewer sales agreed in those regions. Despite this, the national average for the number of sales agreed in the first half of the year is down by only 4.3% on the same period last year. The regions which have set new price records are again all selling better than the national average, with Wales 0.2% ahead of last year, Yorkshire & the Humber down by 1.9%, the North West dropping off by 3.3%, and the East Midlands down by 3.7%.

Shipside adds: “The national market faces a range of challenges, with overall average asking prices barely changed from last year, and activity levels slightly lower. Some buyers are hesitant due to the long-drawn-out uncertainty of Brexit, and there is also a slight tightening of mortgage availability and stretched buyer affordability, especially when it comes to raising a deposit.

“There is however a marked north/south divide as all northern regions are selling better than those in the southern part of the UK. On average the number of sales agreed for the year to date in the northern regions is down by 1.7% compared to the same period  last year, while success at selling is more elusive in the southern regions which are down by an average of 7.1%. To sell in these more difficult locations you have to undercut the asking prices of similar properties, and preferably have a well-finished and expertly marketed home that will all combine to stir hesitant buyer interest.”

Agents’ Views

Mark Manning, Director of Manning Stainton in Leeds, Harrogate, Wetherby and Wakefield said: “This is certainly not a market without its issues as the continuing political uncertainty remains a concern as we move towards the summer. However for now the market in the north seems poised for further growth over the coming months as the sheer weight of buyer demand continues to push prices ever higher across our region. Since the start of the year just over a third of all the properties that we’ve listed have been sold for their asking price or higher and with an average selling price of just over 98% of the asking price it seems that sellers are still calling the shots. Much like in 2018 we have also seen a consistent rise in the number of first-time buyers looking to get on the ladder.”

Nick Leeming, Chairman of Jackson-Stops, comments:“Despite Theresa May’s resignation as Conservative leader, which has caused further disturbance in the political sphere, the property market is bouncing back as buyers come to appreciate the price it costs to bag your dream home in a market where supply remains tight. Northern regions in particular are continuing to show resilience amid this political landscape, with many buyers and sellers in agreement that now is as good a time as any to make a move. With property prices reaching record highs in some northern parts of the country, we should start to see an increase in listings and subsequent transactions as those southern sellers currently sitting on the fence decide to launch their home to the market in fear of missing out on a good deal.”

Regional Trends

National Trends

London Trends

It’s not yet a recovery, but pace of annual fall slows down

  • The price of newly-marketed property in London falls by an average of 0.4% (-£2,709) this month
  • The annual rate of decrease stands at 2.0%, the best it has been since January and a considerable improvement on the 3.8% decrease recorded in March
  • Less severe falls assisted by year-on-year increase in the price of TfL Zone 3 properties, up by 0.5% when all other Zones are still showing annual price drops

The price of newly-marketed property in London falls by an average of 0.4% (-£2,709) this month. There have been price falls in this month for the last three years, since the start of the re-adjustment of parts of the London market.

Miles Shipside, Rightmove director and housing market analyst comments: “The last time we measured a rise at this time of year was back in June 2015, when London property prices were going up by 6% a year. Market conditions are very different now, negatively affected by the triple whammy of stretched buyer affordability, moving costs including stamp duty, and Brexit jitters. The annual rate is still in negative territory at minus 2%.”

While not a recovery, the 2.0% rate of decrease is the best it has been since January and a considerable improvement on the 3.8% drop recorded as recently as March. This less severe fall is assisted by a year-on-year increase in the price of TfL Zone 3 properties, up by 0.5%. All other Zones are still showing annual price drops.

Shipside adds: “A rise in year-on-year prices is an unusual event anywhere in the London market, when set against the backdrop of the annual rate for London as a whole now being in negative territory for 22 consecutive months.  Zone 3’s yearly increase is in contrast to all the other Zones which are currently showing falls, so it sets it apart. With average prices nearly £130,000 cheaper than in neighbouring Zone 2, the price momentum we are currently seeing may be down to buyers being priced out of the more central zones and having to accept a slightly longer commute to work in order to afford to buy.”

                                              

Borough data is based on a three month rolling average and can be used as an indicator of overall price trends in each borough over time. It is not directly comparable with the overall London monthly figures.

 

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