London House Prices Fall
Prices in the capital are down year on year, but continue to rise in the rest of the UK
House prices in London have fallen year-on-year for the first time since 2009, according to Nationwide’s House Price Index. However, London was the only region to see house prices fall, and property prices in the North are now accelerating faster than in the South.
Why is London falling?
The fall in London house prices has been led by the highest value properties declining in value, according to property data company Hometrack. Their most recent report on the London property market cites:
“House prices in the top decile are currently registering price falls of 5.1%. This is down to weaker demand, multiple tax changes and fears over the impact of the Brexit vote on the London economy.”
House prices continue to rise in the rest of the UK
Across the UK house price remains stable, showing 2% year on year growth, however this is down from 2.1% last month.
Commenting on the drivers of property prices, Robert Gardner, Nationwide’s Chief Economist, said:
“Low mortgage rates and healthy rates of employment growth are providing some support for [housing] demand, but this is being partly offset by pressure on household incomes, which appear to be weighing on confidence. The lack of homes on the market is providing ongoing support to prices.” East Midlands sees best growth
East Midlands was the strongest performing region of the UK, with prices up 5.1% year-on-year.
However, the region is long overdue its time in the sun, as this is the first time since 2002 that the East Midlands has taken the top growth spot.
East Midlands top performing region in Q3
Annual house price growth rates across the UK regions remained within a fairly narrow range once again in the third quarter.
East Midlands was the strongest performing region, with prices up 5.1% year-on-year in Q3. This is the first time since 2002 that the East Midlands has taken the top spot.
London was the only region to see a year-on-year price decline, with a 0.6% fall. This is the first time since Q3 2009 that London house prices have fallen on an annual basis.
Northern Ireland saw a softening in annual growth to 2.4%, from 3.8% last quarter, while Wales saw a slight pick-up, to 2.6%. Annual price growth in Scotland was similar to last quarter at 1.9%.
Has any of your properties gone up in value?
If any of your buy to lets have increased in value you might be able to get a better mortgage rate. Different mortgage rates are available depending on your loan to value (LTV), which is simply the size of your mortgage debt compared against your property value.
If you have a lower LTV you will enjoy access to better mortgage deals. The best value deals are typically available to those with at least a 60% LTV, with rates generally going up as LTV goes up. If you would like to explore finance options we work with the best in the business who can help provide suitable finance solutions.
Source: Nationwide House Price Index http://www.nationwide.co.uk/~/media/MainSite/documents/about/house-price-index/2017/Sep_Q3_2017.pdf