House Price Growth – July 2018
The Office for National Statistics have recently released the House Price data for July 2018. No need to panic yet, but it doesn’t make great reading for those in the sector. House prices are still edging up in most areas, albeit that the overall annualised increase over the last 12 months is lower than the equivalent rate of increase for June 2018 and indeed the lowest since August 2013. The average UK house price in April 2018 was £231,000. Overall, this is still £6,000 higher than the average for July 2017 and £2,000 more than last month.
In the past year, average house prices across the UK have risen by 3.1%. The main contribution to the increase in UK house prices in value terms came from England, where house prices increased by 3.0% over the year to July 2018, with the average price in England now £249,000. Wales saw house prices increase by 4.2% over the latest 12 months to stand at £157,000. In Scotland, the average price increased by 3.2% over the year to stand at £152,000. The average price in Northern Ireland is currently £133,000, as the earlier strong growth has flattened out.
In the Regions
On a regional basis, London continues to be the region with the highest average house price at £485,000, but London actually showed a reduction in prices, with a fall of 0.7% in the past year. London is followed by the South East and the East of England, which stand at £327,000 (+1.8% for the year) and £295,000 (+2.4% for the year) respectively. This is the first time since May 2009 that these three areas have shown the lowest growth rates.
The lowest average mainland price continues to be in the North East at £132,000, however, at 5.6% this area showed the highest annual growth, followed by the South West and the West Midlands, which both had annual growth of 4.4%. As expected from the price data, sales volumes were down in the year to May 2018 (the latest data available) in all regions.
In terms of the property type; all property types showed growth in the year; detached houses had the strongest growth at 4.6%, but flats and maisonettes showed the weakest growth at only 0.6% overall. As London accounts for around a quarter of all maisonettes, this somewhat explains the poor growth in prices in the capital. If Mark Carney is to be believed, there may well be far worse to come, as he recently predicted a 35% fall in property prices in the event of a “no deal” Brexit. Good news for those hoping to get onto the property ladder, but if he is right it would certainly be a shock to the sector. The graphic below does show that prices were a mixed bag for the regions in the month of July.