Business

Brexit uncertainty hits house purchases

For sale signs Image copyright PA

The West Midlands had the strongest annual house price growth across the UK in the 12 months to November 2018.

But housing activity in southern England was muted because of Brexit uncertainty.

Average house prices across the UK climbed by 2.8%, rising from 2.7% annual growth in October 2018.

In the West Midlands, prices rose by 4.6%, according to the latest official figures from the Office for National Statistics (ONS) and Land Registry.

It said the average UK house price was £230,630 in October, falling by 0.1% month-on-month.

Slowdown

Over the past two years, there has been a slowdown in UK house price growth, driven mainly by a slowdown in the south and east of England, the report said.

The lowest annual growth was in London, where prices actually fell by 0.7% over the year to November, unchanged from the previous month.

London house prices have been falling over the year each month since July 2018, while potential buyers and sellers have been postponing transactions in the south of England until after the EU withdrawal.

Other regions showing the strongest price growth after the West Midlands included the East Midlands, up 4.4%, the South West, up 4.3%, and the North East, up 4%.

Brexit uncertainty

The Royal Institution of Chartered Surveyors' UK Residential Market Survey for November 2018 reported subdued activity in almost all areas of the UK, mainly driven by Brexit uncertainty and a lack of fresh stock.

The UK Property Transactions Statistics for November 2018 showed that on a seasonally adjusted basis, the number of transactions on residential properties with a value of £40,000 or greater was 100,930, 0.5% lower compared with the same period a year ago.

Kevin Roberts, director of the Legal & General Mortgage Club, said: "The ongoing political uncertainty is clearly causing some buyers and sellers to take a wait-and-see approach when it comes to the property market."

North London estate agent Jeremy Leaf said: "On the one hand, the risk of uncertainty for the property market increases after yesterday's Brexit deal vote, but on the other, it helps to concentrate minds on all sides as the threat of a 'no deal' rises, which was reflected in sterling's strengthening immediately after the result was announced."

Wales records largest price growth

At the country level, the largest annual price growth was recorded in Wales, where prices climbed by 5.5% over the year.

Scotland saw house prices increase by 2.9% over the last 12 months.

In England, the average price increased by just 2.6% over the year.

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