Halifax released their latest house price index for August this morning showing the most recent changes in the property market. The bank and mortgage lender’s monthly report reveals a 0.2% fall from July but a 6.9% jump from the same period last year.
The factors affecting UK property values over the past months include a change to stamp duty that was implemented in April, a lower volume of mortgage approvals, Britain’s vote to leave the EU and the seasonally slow property market during the summer months. The quarterly rate has been on a gradual decline that started in February and is at it’s lowest (0.5%) since December 2014, however values are still up 0.7% on the last quarter.
Russell Quirk, eMoov’s founder and CEO, accredits the falling numbers to the cold spell in the property market during July and August, but is optimistic about the health of the UK property market as a whole.
Today’s figures from Halifax show house prices have cooled a further 0.2% from the 0.1% drop seen in July. Although on the face of it, this may seem like validation of the Brexit inspired blues that have plagued the media over recent months, this decrease is nothing more than a seasonal adjustment due to the slower pace of the market during the summer months.
It may seem like Britain’s decision to leave the EU is starting to take its toll on the UK property market, but in reality, the timing of the referendum vote is just coincidental with this type of market movement traditionally experienced during July and August.
The annual change provides us with a much clearer diagnosis of the current market and shows that prices are still up 6.9% when compared to August last year. This annual calculation is based on the last three months of data when compared to the same three months of 2015, which provides a more honest portrayal of the underlying condition of the market and adjusts for any short term fluctuations such as this marginal month to month drop.Russell Quirk