Although the latest figures from the housing market reveal there was a monthly rise of 0.4% in June (source: Rightmove), conditions vary widely across the country and there is growing evidence of a North/South divide. And, for once, it’s in the North where the market is strongest rather than the South. In the northern half of the UK, houses are still considerably more affordable than they are in the South and, at the same time, there are also shortfalls in supply and high levels of demand.
Rightmove Director, Miles Shipside, observes:
“The reduction in property choice for buyers in the North compared to a year ago is a result of property for sale being snapped up, meaning it’s more of a sellers’ market there. In marked contrast, the jump in buyer choice in all southern regions shows there are signs of a buyers’ market in some areas.”
If you look at Rightmove’s property supply figures it all becomes clear: in the East, supplies are up 24.9% year-on-year. In London they are up 16.4%, whereas the supply of new property in Yorkshire and Humberside was down by 6.3% and by 10.3% in Wales and 10.4% in Scotland. As a result, prices in Scotland were up by 1.4% in June, by 1.3% in Yorkshire and Humberside and by 1.1% in the Northwest, but were down by 0.9% in London.
Nationwide also report a similar monthly rise – 0.5% in June – but note that annual house price rises dropped to 2%, the slowest growth for five years. Like Rightmove, London’s figures were some of the weakest, with prices down by 1.9%, year-on-year.
However, as we highlighted last month, if you delve into the details, it looks like prices in the more central areas of London may now have bottomed out. There were some big rises in asking prices in June in Kensington and Chelsea (+3.6%), and Lambeth (+1.9%).
But, as you head out, market conditions deteriorate, with Kingston one of the biggest fallers at -1.5%. And, interestingly, top end house prices (+2.4%) fared far better than flats (-0.8%).
Prime Central London property tends to be at the forefront of any new property cycle and so any signs of a revival in their prices is good news.
Although, until there is some more certainty over Brexit, the market is unlikely to move significantly.