Brexit and election jitters put brakes on UK house prices

Rightmove finds 0.6 percent month-on-month growth for October – the slowest since late 2008

UK economy in worst state since 2009UK house prices grew at their slowest monthly pace in October since the onset of the financial crisis in 2008. Brexit and uncertainty ahead of the snap December general election have deterred would-be sellers, particularly in London, according to a monthly survey by property portal Rightmove on Monday.

Average prices rose by 0.6 per cent in October compared with September, the smallest increase since October 2008, when the collapse of US investment bank Lehman Brothers triggered a meltdown across the global banking and financial sectors.

The UK government requested an extension to the deadline for the country to leave the EU until January. Yet while Brext uncertainty has deterred sellers and pushed down the number of properties for sale by 13.5 per cent compared with last year, buyers appear less concerned, according to Rightmove director and housing market analyst Miles Shipside.

“In a strange Brexit-induced paradox, thousands of potential sellers are holding back compared to this time a year ago, though the number of buyers agreeing purchases is virtually the same,” he said. “Ironically, this means that those who are coming to market have a better chance of selling, so while some would-be sellers are being put off, it’s actually a good time to sell.

“Those who are ignoring the Brexit disruption have less competition from stay-away sellers, and their prospective buyers have less negotiating power, with a reduced choice of suitable alternatives.”

Rightmove’s monthly house price trends report showed the number of sales agreed was virtually unchanged from a year ago, with a 0.-per cent decline. However, the percentage of sales agreed that had fallen through so far this year was the lowest since 2015.

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London house prices rose by 2.4 per cent in October from the previous month, thanks partly to the lack of homes coming on to the market. Rightmove said this offset September’s 2.0 per cent decline, leave the year-to-date increase in prices at 0.2 percent.

The number of sellers in London fell by 29.2 percent in October, compared with the previous year, the worst year-on-year decline in any month since August 2009, Mr Shipside said.

“However, the sellers who are coming to market seem to be serious about selling, with the result that the number of sales being agreed has increased slightly on the same period last year,” he said.

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FURTHER READING: UK economy is worst state since 2009

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