House prices in England and Wales flat in October, annual growth slowed
Annual house price increase continued to slow in England and Wales in October, down to 0.8% but the slowdown is being driven by declined in London and the South East, the latest index shows. Indeed, excluding London and the South East from the calculation price growth across England and Wales was 2.8%, according to the LSL Property Services/Acadata house price index.
However, month on month price growth was flat with the market seeing the slowest growth since March 2012, taking the average price to £298,438, roughly level with November 2016.
Transactions are also slower, down 5% in the first nine months of 2017 compared to the same period last year. However, the report suggests that this reduction is not surprising when taking into account the surge last March ahead of the 3% surcharge in stamp duty on additional homes which caused sales to soar.
A breakdown of the figures show that London is the only place to see prices fall year on year with a decline of 2.4% to £583,598 while month on month prices fell by 0.3%. The biggest monthly fall was 0.3% in the East of England to £323,124, followed by a fall of 0.2% in the East Midlands to £204,951. The only other monthly fall was in the North East with a decline of 0.1% to £154,543.
The highest annual rise was 4.6% in the North West where prices also increased month on month by 0.5% to £187,114, followed by a 4.4% annual rise in the South West where prices also increased month on month to £279,112.
According to Oliver Blake, managing director of Your Move and Reeds Rains estate agents, it is a challenging time for the market, but outside London many regions are showing some resilience. ‘We have yet to see how this will change in the months to come, particularly following the Autumn Budget when it has been rumoured the Chancellor will make announcements that may impact the housing market,’ he said.
‘The good news, however, is that housing is clearly on the political agenda and any action that supports buyers and sellers, and positive movement in the market, has to be encouraged,’ he added.
The index report also suggests that the top end of the London market has been more likely to see a price drop. Average prices in the top 11 of London’s 33 boroughs are down 5.6% annually, while the bottom third continues to show modest growth of 1%. The middle 11 are just in negative territory, with prices down 0.3%. The City of Westminster has seen the biggest fall annually, down 19.2%, albeit skewed by sales from a luxury new development last year.
However, prices in the City of London were up 10.3% and in Haringey up 10.9%, the biggest increase over the year. Near the bottom, prices have increased by 6.8% in Bexley while in Greenwich they decreased by 7%.
Transaction levels have proven to be more resilient, just 1% lower in the third quarter of 2017 than the same period in 2016. Sales of flats have decreased by 8%, however detached and semi-detached sales have seen an increase of 8% and 9%, respectively.