Whilst asking prices continued their rise on a monthly basis, prices are down year-on-year with some forecasting a continuing stagnation for the year.
The latest price index by Home.co.uk. revealed a house price increase of 0.6% month-on-month in England and Wales and an annual drop of 2.6%. For Scotland the index reported a monthly increase of 0.2% and a yearly rise of 1.6%.
This latest growth increased the average asking price in England and Wales to £300,187 whilst Greater London averages at £541,618 where asking prices had increased by 0.6% month-on-month but dropped by 1.5% year-on-year.
Asking prices rose across all regions, apart from London, on a monthly basis. Yorkshire and the Humber saw the strongest growth with 1.2% which according to Home’s report is due to an increase activity by buy-to-let landlords.
The report also revealed another drop in UK property entering the market with a decrease of 6% year-on-year.
According to Doug Shephard, director of Home.co.uk, the current state seems likely to stay in the UK’s property market: “Whilst this month’s price rises indicate a typical seasonal lift, the overall trend towards lower year on year price growth continues. Rising inflation due to a weaker post Brexit pound means that capital values overall are not rising at all in real terms.”
“However, there is significant growth in several regions over and above the rate of inflation. Vendor confidence remains high in certain regions and is most apparent in the East of England, East Midlands, North West and South West.”
“Whilst the slowdown persists in London and the South East, brought on by oversupply and overly high prices, it is these more outlying regions that are lending the greatest support to the national housing market figures. But the pace of the price increases seems unsustainable in view of affordability constraints and comparatively low rental yields.”
“However, as we approach the end of the first quarter of 2017 with a continually declining year on year price trend, UK property looks fated to endure a year of stagflation at best. In March 2016 the annualised rate of increase of home prices was 7.9% yet today the same measure is a mere 2.6%, “ he concluded.