EU vote could slow house price growth
08/04/2016
House price growth in the UK could slow down due to the uncertainty of the EU referendum, according to the Halifax.
The lender claimed that property prices in the UK have increased by 10.1% over the past 12 months, which means that the average residential property is now worth £214,811.
However, the mortgage lender has suggested that this growth could be set to slow down, because of the possibility of the UK leaving the EU when the referendum is held on the 23rd June. They also said that “worsening sentiment” towards the UK economy could be a factor in any downturn.
Additionally, only parts of the UK are registering significant growth, according to the Office for National Statistics (ONS), causing further uncertainty for some areas. They said that while prices across England rose by an average of 8.6% in 2015, Scotland prices only increased by 0.1%, whilst Northern Ireland prices increased by 0.8% and there was a price fall of 0.3% in Wales.
Supply shortage
Despite this uncertainty, Martin Ellis, housing economist at the Halifax maintained that long-term house price growth will remain robust. He said that this was because demand is still outstripping supply, whilst low interest rates and unemployment levels should ensure this remains to be the case.
One North London estate agent, Jeremy Leaf said: "At the coalface there is still a general shortage of the sort of property that people want to buy."
However, he did say that the recent stamp duty increase could have a negative effect on prices.
Mr Leaf stated: "Although more property is coming onto the market, much of it is aimed at investors who understandably are more reluctant to proceed because of higher stamp duty charges."
The government recently introduced a surcharge on stamp duty for landlords and those buying a second home. This means that those who are hoping to purchase a buy-to-let or second home will face an additional 3% surcharge on the value of their property.
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Add insulation, not paint to your walls
Sellers would do better to make 'green' improvements to their homes instead of making cosmetic changes in order to add value to their property, a new study has shown.Yorkshire Bank's latest house buyer survey reported that 32 per cent of sellers plan to redecorate in order for a sale, yet 33 per cent of buyers said they would entirely repaint their new home anyway, upon moving in.Only 12 per cent...
Read MoreCentre for Economics and Business Research issues downbeat property report
The Centre for Economics and Business Research (CEBR) has today issued a damning review of the UK property market which does not bode well for the short to medium term. The CEBR believes that the UK property market still has a "further 8% to fall" before prices start to stabilise and eventually recover. However, the recovery in the UK property market will be sluggish to say the least with 2010 and...
Read MoreHousing affordability at "critical" point
The availability of affordable housing has reached a "critical" point, with the next generation of home buyers likely to need ten times their average salary to purchase a house unless action is taken, new research has warned.Growing demand for housing is increasingly pricing first-time buyers out of the market, a report from the newly-established National Housing and Planning Advice Unit (NHPAU) s...
Read MoreRepossessions up 8.5% in first quarter
UK lenders issued 8.5 per cent more repossession claims during the first quarter of this year, in a clear sign that borrowers are struggling with higher mortgage repayments and the rising cost of day to day living. Figures from the Ministry of Justice reveal that during the first quarter 38,688 possession claims were issued by lenders in the courts. This compares with the 35,662 mortgage possessio...
Read MoreIs it safe to look at short-term house price performance?
This week's news that UK house prices have risen year-on-year for the first time since March 2008 has injected a dose of enthusiasm back into the UK investment market but is it safe to take one month's figures in isolation and make investment decisions upon these?
While the truth is there have been a number of positive months in the UK property market, there would appear to be a gre...