The fourth quarter may see still lower activity in the housing sector
A poll by United Trust Bank shows more brokers see a further fall in the property sector
The property market in the UK will continue to follow the downward trend in the last quarter of 2017, expect brokers. Although there is a section among brokers who think that house prices in London will be stable or even increase, the number of optimists is strikingly low, and expectedly so.
The figures were reveled following a United Trust Bank poll which asked 140 brokers for their views regarding the property market in London as well as the UK as a whole. More than half (63%) of brokers expect house prices in London to fall further in Q4, 30% expected prices to stabilise and the 7% minority think London prices will show an increase in the last quarter of 2017, according to the poll.
The survey sought brokers’ views regarding Nationwide’s assertion that London was the weakest performing region of the UK for house price growth in the third quarter. The brokers were asked for their views on the outlook for UK house prices which, again, drew similar results. Most brokers think that there will be more downward pressure on prices, a view reflected in the latest report from RICS. A majority of brokers (56%) believe prices across the rest of the UK will weaken compared to 35% who believe they will increase. However 9% believe the UK will see the start of a UK house price crash in the fourth quarter.
The Executive Director of United Trust Bank, Noel Meredith said, agreed with the general consensus that house prices in prime areas of London have come down, the picture for the rest of the UK is less clear. He said that according to RICS, it’s a mixed bag with some regions still seeing good levels of activity whilst others are experiencing fewer buyers and sellers. He added that, however, Nationwide and Halifax figures indicate that on the whole UK house prices rose again in October by 2.5% and 4.5% respectively. The fact is that indices based on averages rarely give a true representation of what’s happening in local markets and in most areas there are still strong levels of activity.
A lack of supply and a strong demand for good value FTB and family homes together with assistance from initiatives like the Help to Buy scheme continue to underpin property values in most parts of the country and the view remains positive. Meredith said that the recent increase to the Bank of England Base Rate may cause some potential purchasers to review their finances but it’s unlikely to cause them to change their mind about buying for the first time or to halt a house move altogether. He said that although this may be the first of several small increases over time, the cost of borrowing for house purchase is likely to remain low. There is no shortage of mortgage lenders offering rates from around 1% to customers with good sized deposits.