Surveys have shown that home prices have slowed down in the past year. Indeed, based on the results from Nationwide’s most recent house price index home prices have been rising at their slowest rate for almost six years. According to the Index, the prices of homes had only risen 0.5% in 2018, leaving the average UK home price at around £212,281.
What does this mean for 2019?
Well, the good news is that home prices will continue to rise albeit at a sluggish pace. Indeed, according to Nationwide we should expect a ‘low single-digit pace’ through the rest of the year. This will be aided by affordable mortgage rates and a low unemployment rate too.
Trouble On The Horizon
Those looking for the cause behind the issues within the housing market through this year should direct their attention to Brexit and the economic uncertainty it is currently fueling. However, this is being combatted partially by a low number of homes for sales and a low level of construction on homes throughout the UK.
Due to this, some like Halifax are predicting a rise between 2 and 4% for house prices through 2019. However, as you may well have guessed this is completely dependent on what happens with Brexit.
Experts within Halifax are suggesting that the biggest concern is going to be how affordable mortgage rates are in the future. While the average pay levels will rise there is still an increased interest rate to consider which could keep home prices more or less steady.
In Contrast the Royal Institution of Chartered Surveyors are predicting home prices will once again become stagnant by around the midpoint of the year. Though, due to the low level of construction on new homes, the RICS is not suggesting we will see drops.
Furthermore, if we see a speedy agreement to withdraw from the EU then this could provide the housing market with the boost it needs. As well as this the RICS are also suggesting that mortgage rates will continue to help buyers and any changes to policy here are predicted to be minimal.
Differences Across The UK
As is so often the case, the housing prices trend is not expected to be constant across all of the UK. Instead, it is predicted that there will be significant changes between South England and the rest of the UK. The strongest growth in home prices is expected to be away from the South East and London.
Instead, according to Nationwide, the best price rises were in wales at 4% through 2018 and Northern-Ireland at 5.8%. In Scotland home prices were just below 1% while England home prices were at a low of 0.7.
There were even dramatic differences between Northern England and the South where the North witnessed 3% climbs even as prices around London dropped by 0.2. Of course, even with these differences, the prices in London remain nearly fifty percent more than the rest of England.
It seems then there is a great level of uncertainty surrounding home prices through 2019, due largely to the shadow of Brexit.