October house price rise slowest in 8 years
Data from Rightmove shows that property prices rose 1 per cent in October, the lowest monthly increase in late autumn since 2010.
On an annual basis this rise comes to 0.9 per cent, which is the slowest increase across this time frame since February 2012.
This means that the average asking price for a property coming to the market in the UK now stands at £307,245 as compared to the £304,061 recorded last month.
Breaking the data down, the report shows a significant decrease in buy-to-let purchase activity, with mortgage approvals for new BTL properties down 14 per cent on an annual basis, or 53 per cent compared to three years ago. This, says Rightmove director and housing market analyst Miles Shipside, “gives aspiring first-time buyers an autumn opportunity to negotiate a favourable deal.”
In fact, the data shows that prices for properties with two bedrooms or fewer, which would typically be targeted by either would-be landlords or FTBs, fell 0.1 per cent on a monthly basis.
Shipside adds: “The fall in prices at the bottom of the market during what is a traditional busier time means that those keen to sell need to price accordingly, which gives an opportunity for those stamp-duty-free FTBs to negotiate harder.
If the Chancellor’s budget later this month encourages more landlords to sell to long-term tenants for rumoured capital gains tax relief, then landlords who are looking to sell and renters who aspire to become FTBs could work together for their mutual benefit.”
On a regional basis, the biggest monthly rise was seen in Greater London, at 1.4 per cent. The worse performer within the same time frame was the South East, at 0.2 per cent.
Across the last 12 months, the West Midlands saw the fastest rise in prices, at 5.5 per cent. Greater London, while enjoying the heretofore mentioned relatively strong monthly rise, experienced the worst annual performance, however, with prices dropping 1.1 per cent.
North London estate agent and former RICS residential chairman Jeremy Leaf comments: “Buyers and sellers seem worried about the two ‘B’s – not only about the impact of a good, bad or indifferent Brexit deal but also the looming Budget at the end of the month.”
Octopus Property head of buy-to-let sales Steve Matthews adds: “A reduction in purchase activity has long been anticipated and the latest figures are the result of the raft of legislative and regulatory changes being introduced.
Having said that, this reduced activity has been accounted for and we expect the BTL market to remain robust, with circa £30bn of annual lending forecast over the next few years.”
Source: Mortgage Strategy