Summer slowdown for house prices
July 2014 House Price Watch indicates house prices are up on average 0.4% in the past month and up on average 8.6% in the past year
August 20, 2014
While market activity remained brisk, average house prices fell in seven out of ten regions in England and Wales in the past month. A seasonal dip in house prices is not uncommon this time of year but signs point to a more general slowdown.
Reports show buyer demand is beginning to tail off. Hometrack’s monthly survey of estate agents and surveyors indicates there was no growth in new buyers registering with agents in June and a further decline in new buyers registering (-0.9%) in July ; a shift in trend from the past 18 months.
While it is still viewed to be a good time to sell, buyer confidence is softening with talk of stricter lending criteria and a possible interest rate rise in 2015. The Halifax Housing Market confidence tracker indicates 57% think it is a good time to sell in the next 12 months (highest since index began in 2011), while those who think it is a good time to buy, is down by 29 points in the last quarter.
Nationwide reports a modest rebound in mortgage approvals in June but a decline in approvals by almost 20% between January and May. “At least part of the slowdown in activity relates to the introduction of Mortgage Market Review measures.”
“A more thoughtful and prudent housing market is emerging. Lending is stabilising to sustainable levels, and supply and demand is more balanced.” LSL Property Services
“A price fall in July is not unexpected as prospective buyers turn their attention to the summer holidays. Buyer confidence may also have taken a knock with suggestions that mortgages are becoming harder to get and repayments may get more costly sooner than originally anticipated should rumours of an interest rate rise before the next election come true.” Rightmove
In the past month, prices fell in all regions but the West Midlands, South East and London. The momentum of price rises in the London market is slowing.
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