Usual spring buoyancy weighed down by Brexit

New Rightmove data shows the property market is cooler than usual for this time of year as the traditionally busier spring period is affected by the uncertain political climate.

Our data scientists have found that the average price of property coming up for sale has risen by just 0.4% this month, which is the lowest average monthly rise at this time of year since 2011.

Rightmove’s property expert Miles Shipside said: “While March marks the start of spring, temperatures have yet to rise in the housing market. Buying activity remains cooler than usual, with hesitation as some buyers await a more settled political climate. There’s greater resilience the further away you get from the London market, and there’s a sound bedrock of demand for the right property at the right price, reinforced by ongoing housing needs combined with cheap mortgage borrowing.”

Despite the political uncertainty, search activity on Rightmove remains steady.

This indicates that home movers are keeping a watching brief of the market, which could lead to an eventual bounce if and when Parliament finds a breakthrough on Brexit.

London continues to be the main drag, however, as nine out of 11 regions still see new-to-the-market sellers pricing higher than a month ago.

Prices in the capital are down by 1.1% on the previous month, while the other region to record a monthly fall is the North East, down by 1.3%. But their respective pricing histories are very different.

London prices are still 68% higher than ten years ago, with buyers looking for prices to settle at a level of fair value, but the North East has seen new seller asking prices up by just 8% in that time.

Shipside added: “Markets and people do not like uncertainty, though while sales agreed numbers are down by 7%, that means they are still running at 93% of last year’s levels. Most potential buyers are getting on with their lives or seeing a price lull as an opportunity to get onto the housing ladder or move to the next rung, with average national asking prices being 0.8% cheaper than a year ago.”

Agents also agree that the market would benefit from a resolution to Brexit sooner rather than later.

Tom De Ville, Director at Fine and Country Nottinghamshire, says: “The wheels are still turning in the housing market but they’re turning more slowly than this time last year as there’s hesitation from both buyers and sellers. A more certain political outcome would help to reassure those currently hesitating and would help to get the wheels turning more quickly again, and it would also help boost much-needed supply. Houses that are priced sensibly are still selling but there are some sellers who haven’t realised that there’s been a shift in power from a sellers’ market to a buyers’ market.”

Guy Gittins, Managing Director of Chestertons, says: “It was almost inevitable that the uncertainty of Brexit would drag property prices down in the short term, especially as the date gets closer and many buyers take a ‘wait-and-see approach’. However, we have experienced an incredibly busy start to the year, with a sharp increase in buyer registrations, viewings and offers throughout January and February, which reflects pent-up demand and suggests that prices are now at a level that buyers are comfortable buying. I therefore see this month’s drop as a temporary blip and expect prices to recover once the market has more clarity on Brexit. Over the medium-and long-term, London property has outperformed most other asset classes and we believe it will remain a solid investment, regardless of the Brexit outcome.”


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