UK Annual House Price Growth Slows


The pace of annual house price growth slowed to 5.3% in September, from 5.6% in August, though it remained within the narrow range of 3% to 6% that has prevailed since early 2015.

The relative stability in the rate of house price growth suggests that the softening in housing demand evident in recent months has been broadly matched on the supply side of the market. Survey data indicates that, while new buyer enquiries have remained fairly subdued, the number of homes on the market has remained close to all-time lows, in part due to low rates of construction activity.

Regional price trends were also little changed. Regions in the south east of England continued to record the strongest gains even though price growth slowed noticeably in the Outer Metropolitan region (from 12.4% in Q2 to 9.6% in Q3) and in London (from 9.9% in Q2 to 7.1% in Q3).

House price growth remained subdued in Scotland (+2%) and Northern Ireland (+2.4%) and small price declines were recorded in Wales (-0.5%) and the North of England (-0.2%), all relative to Q3 last year.

The number of new homes built in England has picked up, but is still not sufficient to keep up with the expected increase in the population. In the four quarters to Q2 2016, 139,000 new houses were completed, 30% higher than the low point seen in 2010. However, this is still around 15% below the average rate of building in the five years before the financial crisis and 38% below the 225,000 new households projected to form each year over the coming decade.

Comments Robert Gardiner – Nationwide Bank Chief Economist: “With interest rates expected to remain low and schemes, such as Help to Buy, helping to provide those with smaller deposits access to finance, housebuilders should have confidence that there will be sufficient demand from buyers if more homes are built. The major housebuilders appear to have capacity to expand output, with most reporting land banks that could support around five years' worth of construction at current rates of building activity. However, there is a risk that the uncertain economic outlook may weigh on activity in the period ahead.”

Abode Affiliates

  • MG&AG
  • Rosemont Consulting
  • Select Villas
  • Knight Frank
  • 7Storeys
  • Gama Property
  • Lida Cucina
  • Cyan International Properties
  • Costa Rica Real Estate Service
  • Las Colinas
  • Lampert & Harper
  • Ibiza Transit Express
  • Coldwell Banker
  • Premium
  • Wall Street Luxury
  • Jumeirah
  • FOC
  • BDO
  • Pedini London
  • La Balise Marina
  • Prestige Dubai
  • Moore Stephen
  • Cornerstone Tax Advisors
  • Touch Design Group
  • St Francis Links
  • Alexander James
  • Alleyne Real Estate
  • My Bermuda House
  • Blevins Franks
  • CID
  • London Fractions
  • Edenhurst
  • The Highland Club
  • Little Projects
  • The Hideaways Club
  • Dost & Co
  • Oyster Yachts
  • Crane Resorts
  • Luxury Italian Living
  • Worldwide Dream Villas
  • Enigma Yachts Limited
  • Unique Home Stays
  • Heron Real Estate
  • Monaco Real Estates
  • RDO
  • Destinology
  • Wings
  • Ultra Villa
  • Yoo
  • Habitat First Group
  • St Edward

Enter your dream destination