Statistics from the Office for National Statistics (ONS) and Land Registry show that the West Midlands had the strongest regional annual house price growth across UK in the year up to November 2018, with prices on average rising by 4.6%.   Growth in the North East, South West and East Midlands was 4%, 4.3% and 4.4% respectively.

Average house prices across the UK climbed by 2.8%, rising from 2.7% annual growth in October 2018; the average house price in that month being £230,630.

In contrast though, housing activity in southern England slowed, with prices in London actually falling by 0.7% over the year to November 2018. This was blamed on Brexit uncertainty and a lack of fresh housing stock in the Royal Institution of Chartered Surveyors’ UK Residential Market Survey for November 2018; this also reported subdued activity in almost all areas of the UK. The UK Property Transactions Statistics for November 2018 showed the number of transactions on residential properties with a value of £40,000 or greater was 0.5% lower compared with the same period a year ago.

At a national level, the largest annual price growth was recorded in Wales, where prices climbed by 5.5% over the year.  Over the same period, house prices in Scotland increased by 2.9% and by 2.6% in England.

A market for first time buyers?

In November 2018, 36,200 first-time buyer mortgages completed, rising 5.8 per cent from the same month last year, according to UK Finance. The amount of lending represented a 9.1% increase year-on-year.

The Director of Mortgages at UK Finance attributes this to an increased range of competitive deals and schemes including Help to Buy enabling more first-time buyers to get a foot on the housing ladder.  According to their statistics, the average first-time buyer is 30 years old and has a gross household income of £42,000.

At the same time, homeowner re-mortgaging activity has steadied, buy-to-let market new home purchases remain subdued and re-mortgaging continues to grow as landlords take advantage of attractive interest rates.

There are concerns however, in light of a survey by the Bank of England that showed lenders are forecasting the demand for mortgages and credit card lending to fall to the lowest level since the end of 2010.  This is supported by 41% of respondents to the Royal Institution of Chartered Surveyors’ UK Residential Market Survey predicting that property sales will continue to fall, rather than rise, in the near term.

A significant drop in the property market is likely to lead to prices dropping again as was seen in 2008/2009, although this could potentially be good news for first time buyers, provided the advantageous mortgage deals and schemes remain available to them.

Whether you are looking to buy your first home, re-mortgage your home, or sell up, our property solicitors can help. Get in touch with the team on 0845 287 0939 or contact us via our online contact form.