HOUSE prices have risen 1.1 per cent in June despite Brexit uncertainty after the General Election result.
Experts predicted the results of the General Election 2017 were likely to cause high levels of uncertainty in the UK house market.
But Nationwide’s latest House Price Index reveals otherwise. According to its figures, prices rose 1.1 per cent, month-on-month in June, reversing the previous three months’ falls.
Annual house price has also risen to 3.1 per cent, and the gap in house price growth between strongest and weakest performing regions in the second quarter of the year is the smallest on record.
Robert Gardner, Nationwide’s Chief Economist, said the decline in house prices over the last three months may have been erased, but he warned monthly growth rates can be volatile, even after accounting for seasonal effects
He explained: “The annual rate of house price growth, which gives a better sense of the underlying trend, continues to point to modest price gains. Annual house price growth edged up to 3.1 per cent from 2.1 per cent in May. In effect, after two sluggish months, annual price growth has returned to the three to six per cent range that had been prevailing since early 2015.”
Robert added: “There has been a shift in regional house price trends. Price growth in the South of England has moderated, converging with the rate prevailing in the rest of the country.
“In Q2 the gap between the strongest performing region (East Anglia, which saw five per cent annual growth) and the weakest (the North, with one per cent growth) was the smallest on record, based on data going back to 1974. Nevertheless, when viewed in levels, the price gap between regions remains extremely wide.
“London saw a particularly marked slowdown, with annual price growth moderating to just 1.2 per cent – the second slowest pace of the 13 UK regions and the weakest pace of growth in the capital since 2012.”
Jeremy Buncombe, Director, Legal & General Mortgage Club, said while the house price rise in the face of political uncertainty demonstrates the market’s resilience, this will be sobering news for many first-time buyers who are struggling to make their first step onto the ladder.
He said: “For a healthier market, what we need to see is property prices rising in line with inflation.
“With Monday’s announcement of a coalition agreement, the newly-formed government must consider solutions to restructure our housing market and introduce measures that bring house price inflation in line with earnings.
“More affordable housing needs to be built to allow all those who wish to do so, a better chance of achieving homeownership.
“More than that, however, we also need to see incentives for home movers and last time buyers looking to downsize, so that we can get out housing market on the move.”
The UK property market was steady in May despite uncertainty ahead of the General Election result.
It was always going to be a testing time for the UK property market in terms of how consumers would react to yet more political upheaval.
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