Nov 2019 House Price Watch

House prices are up on average 0.2% in the past month and 0.8% in the past year

The major indices report the following changes in house prices over the past month:

House prices fall in most regions over the past month

Apart from Wales and Yorkshire & Humber, all regions have experienced a fall in house prices over the past month.

Annual house price growth has been modest across most regions of the UK. Wales and Yorkshire & Humber have experienced the fastest rates of annual growth at 3.3% and 3.2% respectively.  London (-1.6%), the North East (-1.1%) and the South East (-0.3%) have experienced a fall in house prices over the past 12 months.

Home sales increase in October

Residential property transaction figures from HMRC show that transactions increased 4% in Oct (103,680) and are up slightly on the same month a year ago (100,890) (HMRC Oct 2019 UK residential property transactions)

New buyer enquiries and seller instructions fall in November

RICS residential market survey indicates that new buyer enquiries and new seller instructions continued to fall in November.  Rightmove reports a 15% fall in the number of sellers in the same period as a year ago.  Lacklustre price growth and political uncertainty are seen to be putting off sellers.

What the indices say?

HomeOwners Alliance: “House price growth notched upwards this month and the annual rate of house price growth sits close to 1% as we near the end of 2019. The mood among buyers and sellers continued to be cautious in November, but with a decisive election outcome, 2020 should see an end to the period of uncertainty and demand from homebuyers should pick up.  Increased buyer demand and an ongoing limited supply of homes for sale is likely to mean upward pressure on house prices and we would expect to see modest annual house price growth of 2% in 2020.”

Rightmove:  “Rightmove predicts that the price of property coming to market in Britain will rise by 2% in 2020. Home-mover confidence and activity have been dogged by political uncertainty since the 2016 referendum.  With a clear majority in the election, there is now an opportunity to release some of the pent-up demand in the spring, and for some modest upwards price movement.  Sellers’ pricing power will be enhanced by a lack of choice for potential buyers, with the proportion of estate agent stock that is available for purchase at its lowest for over two years.”

Nationwide: “Annual house price growth remained below 1% for the 12^th month in a row in November.  Indicators of UK economic activity have been fairly volatile in recent quarters but the underlying pace of growth appears to have slowed as a result of weaker global growth and an intensification of Brexit uncertainty.  To date, the slowdown has largely centred on business investment, while household spending has been more resilient.  Analysis of house price movements around previous elections shows that market trends have not traditionally been impacted around the time of general elections.  Rightly or wrongly, for most home buyers, elections are not foremost in their minds while buying or selling their home.”

Halifax: “Average house prices rebounded somewhat in November with the biggest monthly rise since February, following 2 months of modest falls.  While a degree of uncertainty remains evident, it’s also clear that buyers and sellers are responding to factors such as improved mortgage affordability and the limited supply of available properties.  It is these issues which we believe will continue to underpin the resilience evident in the market for most of 2019.  Over the medium term, we expect the emerging trend of modest gains to continue into next year.”

RICS: “The November 2019 RICS Residential Market Survey results continue to display a cautious approach from both buyers and sellers. Key metrics capturing buyer demand, new instructions and sales remain in negative territory. Much of the anecdotal commentary suggests that uncertainty surrounding the General Election and Brexit are continuing to stifle activity. However, near term expectations suggest that a more stable trend is likely to emerge over the coming three months. Significantly, the twelve-month outlook is also now pointing to a pick-up in both sales and prices on a UK-wide basis.”

To see how we calculate our House Price Watch click here and to see previous reports click here