According to the Halifax, average house prices dipped marginally in June, falling by 0.3%, to stand at £237,110. This extends the largely flat trend the lender has been tracking over recent months. However, more generally the housing market is displaying a reasonable degree of resilience in the face of political and economic uncertainty. Recent industry figures show demand looking slightly more stable, with mortgage approvals ticking along just above the long-term average.
One of the major restraining factors on the volume of transactions in the market continues to be the very low level of stock for sale. Halifax highlight that, with the ongoing lack of clarity around Brexit, people will be looking for more certainty in the coming months, both to encourage them to list their property and to create the confidence needed to encourage buyers.
Supporting the analysis is the Bank of England industry-wide figures that show the number of mortgages approved to finance house purchases – a leading indicator of completed house sales – have fallen by 636 from April to 65,409 in May. The May rate is now just below the 5 year average monthly approval rate of 66,138 and 46 above the previous 12 month average of 65,363. (Source: Bank of England, seasonally-adjusted figures) The RICS UK Residential Market Survey saw a slightly more stable picture coming through during May. The sales to stock ratio increased slightly to 31.5%. Agreed sales fell for the tenth successive month, but less so than previously. Near term expectations remain subdued but sentiment on the longer term outlook for sales and prices signals modest recovery further out. (Source: Royal Institution of Chartered Surveyors’ (RICS) monthly report)