Uncertainty as the Brexit deadline approaches and plunging prices of London property have been blamed for driving national growth down by 0.2% in September.
Robert Gardner, Nationwide’s chief economist, said house price growth had almost ground to a halt in September. This, he revealed, marked the tenth month in a row in which annual growth had been below 1%.
While Northern Ireland fared well during the summer months with growth at 3.4%, in London prices plummeted by 1.7%.
The figures were released as insurance and pension firm, Royal London, revealed over 3.2 million Brits had put off buying a home because of Brexit.
However, property experts were not panicking just yet, despite the monthly falls. Indeed, over the year prices are still increasing, going up by 0.2% annually. What’s more, the fact that prices are still going up in most areas of the UK was encouraging to many.
Sam Mitchell, CEO of online estate agent Housesimple said: “As the deadline to Brexit edges closer it is reassuring to see any growth at all, albeit very slow, with some buyers and sellers keeping their nerve in these times of political uncertainty.
He added: “House prices in London and the South East have been hit particularly hard, but let’s not forget prices continue to grow in all other regions.
“While the north-south divide may be narrowing, northern regions are still experiencing consistent growth as buyers make the most of increased affordability alongside the ultra-competitive mortgage rates of late.”
Discounting for a quick sale
Meanwhile Lucy Pendleton, founder director of estate agents, James Pendleton, said the trend for falling prices was a ‘flash in the pan’
She added: “As a result, on the doorstep in the capital, the smart money is keen to adapt and these sellers are now going much further much quicker in terms of discounting their properties to secure the one they are buying at the right price too. Their reward is a transaction that goes through in a couple of months rather than a couple of quarters.
“It’s true though that some people have found it hard to adjust so there are still a few stragglers out there.”
First-time buyer opportunities
Lower house prices also offer opportunities for first-time buyers, who can also take advantage of earnings growth and record-low interest rates to help get onto the property ladder.
Dilpreet Bhagrath, mortgage expert at online mortgage broker, Trussle, offered advice to anyone keen to make their move while prices were lower.
“With the current uncertain economic and political landscape, prospective buyers could consider a fixed rate mortgage deal. Knowing how much repayments will cost each month will give some piece of mind.
“When speaking to a lender or broker, it’s also worth asking what the true cost of each deal is. This means you’ll know exactly how much you’ll pay over the initial term, accounting for any fees and incentives associated with the deal, as well as the interest rate of the mortgage.
“As ever, it’s always important to consider any personal and future circumstances when securing a mortgage, and seek advice to ensure you’re aware of the available options.”
