UK annual house price growth slows to 1.4% in April

Average house prices across the UK increased by 1.4 per cent in year to April 2019, down from 1.6% in March 2019, figures published in the Office for National Statistics (ONS) UK House Price Index: April 2019 revealed.

The office noted that, over the past three years, there has been a general slowdown in UK house price growth, driven primarily by a slowdown in the south and east of England. The lowest annual growth was recorded in London, where prices fell by 1.2 per cent over the year to April 2019, up from a fall of 2.5 per cent in March 2019.

In the month, the average house price in the UK was £229,000 - £3,000 more than in the same month a year ago. On a non-seasonally adjusted basis, average house prices in the UK increased by 0.7 per cent between March 2019 and April 2019, compared with a rise of 1 per cent in average prices during March and April 2018. However, on a seasonally adjusted basis, average house prices in the UK decreased by 0.2% between March 2019 and April 2019.

Looking at property prices on a country level, house price growth in Wales increased by 6.7 per cent in year to April 2019, up from 3.9 per cent in March 2019, with the average house price at £164,000. The ONS noted that the strengthening in the annual growth rate for Wales is due to both strong growth between March and April 2019 (2.4 per cent) and falling prices (0.3 per cent) between March and April 2018. According to the office, falling prices between March and April 2018 may be linked to Land Transaction Tax (LTT) replacing UK Stamp Duty Land Tax in Wales (SDLT) from April 2018.

In England alone, the average house price increased by 1.1 per cent over the year to April, down slightly from 1.3 per cent in March 2019, with the average house price sitting at £245,000. The East Midlands was the English region with the highest annual growth, with prices increasing by 2.9 per cent in the year to April 2019. This was followed by the North West, with prices increasing by 2.6 per cent.

London saw the lowest annual growth rate in April, where prices fell by 1.2 per cent over the year. However, this percentage is an improvement over March, when prices fell by 2.5 per cent. Despite this, the capital remains the most expensive area to purchase a property, with an average price of £472,000.

Following behind London was the South East, where prices fell by 0.8 per cent over the year. Average house prices in the South East in April were recorded at £319,000.

Scotland’s housing market saw a similar trend in April 2019, though the drop was more significant. House prices in the highlands increased by 1.6 per cent in the year to April 2019, down from 3.5 per cent in year in March, with the average price in Scotland now £151,000.

Northern Ireland house prices increased by 3.5 per cent over the year to Quarter 1 (Jan to Mar) 2019. Northern Ireland remains the cheapest UK country to purchase a property in, with the average house price at £135,000.

Commenting on the figures, Landbay CEO and co-founder John Goodall said: “We are seeing a traditional summer slowdown in house price growth, mirroring the slow start to the year. The north-south divide continues to widen as growth stagnates in the south, especially in London.

“The hot topic of the moment is the Conservative leadership race, and it is absolutely crucial that contenders for the top job are considering the housing market whilst finalising policies and a potential cabinet. Both in the run-up to the Brexit deadline and beyond, the Government must acknowledge the opportunities and challenges that lie ahead; the private rental sector is more important than ever, but uncertainty looms. Landlords should keep a close eye on the ever-changing political landscape if they hope to maximise their yields throughout the year ahead.”

Trussle mortgage expert Dilpreet Bhagrath urged those looking for a home in London to “start their search now”, adding that it may be a “wise decision” with house prices in the capital falling by 1.2 per cent and wage growth at 3.4 per cent.

According to Bluestone Mortgages director of sales and marketing Steve Seal, it’s “good” that house prices are not rising like they used to, adding that many first-time buyers are able to take their first steps on the property ladder thanks to the north/south divide “correcting itself”, low interest rates, government schemes and annual house price inflation more aligned with wage growth, particularly with some lenders able to offer a mortgage to those with a 5 per cent deposit.

However, he noted that those who have “suffered a financial bump” may believe getting onto the property ladder is “easier said than done”. “Many will feel homeownership is out of the reach if they have been turned away by a high-street lender. A missed credit or bill payment can leave a mark on a credit score, but this shouldn’t disqualify an individual from securing lending altogether. A one-off explainable event is not a repeat occurrence,” he concluded.

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