Property prices and sales falling in England and Wales, latest index suggests

Average property prices in England and Wales fell by 0.3% in April and by 0.2% quarter on quarter to £285,082, according to the latest residential index to be published.

Sales were also down, falling by 12.6% quarter on quarter and by 15.4% month on month, the data from the LCPAca index shows.

But in the new build sector prices increased quarter on quarter by 0.2% to £341,409, although in this sector sales are down substantially with a quarterly fall of 18% and representing 9.9% of the market, down from a 14.4% high in June 2016.

In the Greater London area prices remained largely unchanged, up 0.2% in April and reversing a fall in March, and up 0.6% quarter on quarter to an average of £609,965. Sales are down by 15.3% month on month and by 7.9% quarter on quarter.

However, the average price of a new build increases by 2.5% on a quarterly basis but sales were down by 18.5%. Buyers in London pay on average 10.7% more for a new build, the data also shows.

The price of a new home in the prime central London market increased by 31.9%, but sales in this sector were down by 15.6% annually. Overall, average prices fell by 2.9% in the prime market and sales were down by 7.6%.

According to Naomi Heaton, chief executive officer of London Central Portfolio, the prime central London market has experienced unprecedented pressures with a series of new taxes targeted at the residential sector, in particular higher rates of stamp duty.

Naomi Heaton said:

‘An unsettled political backdrop and slow progress on Brexit negotiations have further dented sentiment, resulting in a picture of price sensitivity and falling transactions.’

She pointed out that average prices in Greater London, excluding new build, are now back at the same level as they were in April 2017 and the large drop in transactions is difficult to explain.

Heaton explained:

‘There is no obvious single external factor. However, economic uncertainty around Brexit and a weak market may be encouraging buyers and sellers to sit tight.’

Overall, she warns that confidence in the housing market in England and Wales appears to be disappearing quickly.

Heaton concluded:

‘The Government is going to need to find some way of reassuring the nation soon, otherwise it is unlikely there will be any change in sentiment this side of March 2019.’

Kindly shared by Property Wire