Dawn of new decade will bring fall in house prices
10 December 2019
By Daisy Stephens
Reallymoving's House Price Forecast has predicted that house prices will dip in the next three months.
Reallymoving’s latest research forecasts a 1.1% fall in both December and February with no change in January, making a total projected dip of 2.1% over the next three months. However price falls in February are typical and annual growth will remain in positive territory, albeit against a relatively poor performance last autumn when prices fell by 4% between August and December.
The most recent Land Registry Price Paid data, which is published retrospectively, supports positive year-on-year growth despite a General Election and further delays to the UK’s anticipated departure from the EU.
Regional forecasts show that the dip in house prices is expected in ten of the twelve regions of the UK, with the East of England and the North East being the only areas to buck the trend. The heaviest falls are forecast in Wales (-15.4%), Northern Ireland (-5.8%) and Yorkshire & Humber (-5.5%), although similar datasets are likely to contribute to volatility of data in these areas. As the region most affected by uncertainty surrounding Brexit, London is expected to see prices fall by 3% but it is also the area most likely to see in increase should Brexit be resolved with a deal and a departure at the end of January.
Rob Houghton, CEO of reallymoving, comments: “Buyers have driven hard bargains on deals agreed during the autumn, as would be expected in the run up to Christmas and considering the wider political circumstances.
“But the market has shown resilience and stability throughout 2019 and as fears of a crash have faded, buyers have adjusted to the ongoing uncertainty and proven themselves keen to get deals done. Encouraged by cheap loans and favourable buying conditions, first time buyers are a strong force in the market, accounting for 54% of all purchases.
“Transaction volumes remain down by around 12–15% currently, but if the Conservatives win the General Election as the polls suggest and manage to secure the UK’s withdrawal from the EU at the end of January, a rise in demand from these buyers could prompt a rapid bounce in prices as the uncertainty surrounding Brexit is resolved.”
For more information about the expected change in house prices over the coming months, have a go with the House Price Forecast
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