Despite a rocky year of political uncertainty for the UK housing market, the latest figures for Halifax show that December brought some festive cheer for homeowners as house prices increased by 1.3% on a monthly basis, up 2.2% year on year.
While they still fell on a quarterly basis, down -0.4%, Halifax stated the rate of growth remained within their forecast for the year and predicted continued stability in 2019.
The number of monthly sales was also up over the last quarter although mortgage approvals, a leading indicator of buyer demand, fell to their lowest rate since April as would be homeowners continue to refrain from a purchase until the dust has settled on our EU departure.
While mortgage affordability remains high, the initial financial barrier of raising a deposit also continues to price many buyers out of the market. This will remain a factor over the coming year, despite positive signs of annual pay growth, and although the market remains fairly unphased at present the outcome of the Brexit process will play a huge part in market performance in 2019.
CEO and Property Expert, Andy Soloman, commented:
“Somewhat of a shock result with the housing market staging one of the great, late comebacks in 2018, although a string of shoddy results means that prices are still down on a quarterly basis.
Despite the strong monthly growth, this erratic movement will do little to stabilise a market that has and will continue to suffer from wider political uncertainty.
While other external factors such as mortgage affordability and a lack of stock may continue to stimulate the market to a certain extent, we’ve already seen a number of inbound buyer and seller enquiries stating concerns over Brexit so far this year.
This political rot is setting in at all levels of the market, not just the upper echelons and while largely restricted to London and the South East, this air of trepidation is likely to persist until the credits roll on the government’s comedic Brexit offering.”