‘Boris Bounce’ in the UK Housing Market?

The New Year has brought much positive talk in the market as confidence seems to be returning the UK housing market. Whether you are feeling that positivity would be interesting to know but, in the meantime, we will see the usual plethora of UK housing market reports.

Today the RICS UK Residential Market Survey released their stats and this provides that vital opinion of estate agents whom, of course, are at the coal front of the UK housing market. The level of importance attributed to this data is reflected in that no lesser institutions than the Bank of England and IMF use it as a key indicator.

The RICS report that buyer enquiries, agreed sales and new instructions have all risen in January, with their respondents across all regions upbeat on the outlook for sales in the coming year. According to the RICS, typical prices across the UK housing market are up, driven by a turnaround in London and the South East. They say that the headline price net balance moved up to +17% (compared with -2% in December) with London in the positive for the first time in some years. Across other parts of the country Northern Ireland and Scotland have displayed the strongest house price growth across the UK housing market.

With new buyer enquiries up +23% (building on +19% in December) and agreed sales up for a second month at a net balance of +21%, respondents were anticipating the market gathering pace in 2020.

Halifax Report UK Housing Market Price Rises

Also this month, the Halifax House Price Index released their statistics showing a 4.1% growth in house prices. Their report, released on 7 February 2020, states that house prices in January were 4.1% higher than in the same month one year earlier which, on a monthly basis, is a 0.4% rise. They also state that in the last quarter, being November to January, house prices showed a 2.3% increase on the previous quarter (August to October).

According to Russell Galley, Managing Director of the Halifax; “A number of important market indicators continue to show signs of improvement. We have seen a pick-up in transactions with more buyer and seller activity consistent with a reduction in uncertainty in the UK economy. However, it’s too early to say if a corner has been turned. The recent positive figures may actually represent activity that would ordinarily have been expected to take place last year but was delayed by economic uncertainty. So, while housing market activity has undoubtedly increased over recent months, the extent to which this persists will be driven by housing policy, the wider political environment and trends in the economy.

“Looking ahead, we still expect a moderate rate of house price growth over the course of the year. Demand is likely to continue to exceed the supply of properties for sale across the UK, with the subdued pace of new building also adding to upwards price pressure. The environment for mortgage affordability should stay largely favourable. However, with the growth in rental costs accelerating, many first-time buyers will continue to face a significant challenge in raising necessary deposits.”

Certainly, as we at Developer Money Market have talked to estate agents and developers this year about the UK housing market, the pace of sales, including some of the previously hard to budge units, has improved. The next house price index for the month comes from Rightmove whom give us another insight into buyer and seller confidence. Other reports this month will come from The Office of National Statistics, The Nationwide Building Society, Zoopla and so on.

We look forward with the usual fascination as to how the UK housing market will progress.

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