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| London house prices fall for eighth quarter running as Brexit slowdown continues - business live | London house prices fall for eighth quarter running as Brexit slowdown continues - business live |
| (32 minutes later) | |
| The threat of a no-deal Brexit this autumn is hurting the UK housing market, says Andrew Montlake, director of mortgage broker Coreco. | |
| “The impact of political events on sentiment has been palpable in recent weeks and this is reflected in the June house price index. | |
| “In April and May, there was a renewed vigour among buyers and sellers alike as the March 29 Brexit deadline passed. | |
| “In June, demand dropped off again following the resignation of Theresa May and the increased likelihood of a no-deal Brexit. | |
| “There’s without doubt a degree of Brexit apathy out there driving transactions but no-deal is increasingly at the back of people’s minds. | |
| Here’s a full breakdown of UK house prices by region. | |
| As you can see, London property remains much pricier than the rest of the UK. | |
| Despite falling for the last two years, prices in the capital are still only around 5% below the all-time highs recorded in early 2017 -- and around 50% higher than in 2007 (compared to 17% higher across the whole UK). | |
| Economist Howard Archer of the EY Item Club predicts that Brexit uncertainty will keep dragging the UK housing market back. | Economist Howard Archer of the EY Item Club predicts that Brexit uncertainty will keep dragging the UK housing market back. |
| We believe with Brexit being delayed until 31 October - and it currently very unclear what will happen then – and the domestic UK political situation unsettled, prolonged uncertainty will weigh down on the economy and hamper the housing market. | We believe with Brexit being delayed until 31 October - and it currently very unclear what will happen then – and the domestic UK political situation unsettled, prolonged uncertainty will weigh down on the economy and hamper the housing market. |
| Consumers may well be particularly cautious about committing to buying a house, especially as house prices are relatively expensive relative to incomes. Indeed, consumer confidence dipped in June. Also it looks questionable whether the labour market and earnings growth will sustain their recent strength as companies tailor their behaviour to a lacklustre domestic economy, prolonged Brexit uncertainties, an unsettled UK political situation and a challenging global environment. | Consumers may well be particularly cautious about committing to buying a house, especially as house prices are relatively expensive relative to incomes. Indeed, consumer confidence dipped in June. Also it looks questionable whether the labour market and earnings growth will sustain their recent strength as companies tailor their behaviour to a lacklustre domestic economy, prolonged Brexit uncertainties, an unsettled UK political situation and a challenging global environment. |
| Britain’s housing market is stuck “in limbo” awaiting some political and economic direction and certainty, says Jeremy Leaf, north London estate agent | Britain’s housing market is stuck “in limbo” awaiting some political and economic direction and certainty, says Jeremy Leaf, north London estate agent |
| Leaf also reports that some sellers are accepting offers well below their asking price, a sign that the market is subdued: | Leaf also reports that some sellers are accepting offers well below their asking price, a sign that the market is subdued: |
| ‘At the sharp end, many buyers in particular are still cautious but looking beyond 31st October whereas successful sellers are facing up to sometimes unpalatable offers in order to move on.’ | ‘At the sharp end, many buyers in particular are still cautious but looking beyond 31st October whereas successful sellers are facing up to sometimes unpalatable offers in order to move on.’ |
| House prices across England are “effectively flat” over the last year, says Nationwide. | House prices across England are “effectively flat” over the last year, says Nationwide. |
| In Scotland, prices have rise by 0.4%, slightly below the national average of 0.5%. | In Scotland, prices have rise by 0.4%, slightly below the national average of 0.5%. |
| Northern Ireland is the strongest performing home nation for house prices, with annual price growth rising to 5.2%. In Wales, prices rose 4.2% in the last year. | Northern Ireland is the strongest performing home nation for house prices, with annual price growth rising to 5.2%. In Wales, prices rose 4.2% in the last year. |
| The long-running gap between house prices in the North and the South of England has narrowed since the Brexit vote, today’s survey shows. | The long-running gap between house prices in the North and the South of England has narrowed since the Brexit vote, today’s survey shows. |
| While prices keep falling in London, Yorkshire & Humberside was the best performing region with prices up 3% over the last year. | While prices keep falling in London, Yorkshire & Humberside was the best performing region with prices up 3% over the last year. |
| Nationwide says: | Nationwide says: |
| “House price growth across northern England (North, North West, Yorkshire & Humberside, East Midlands and West Midlands) averaged 2.1%, remaining ahead of that in the south (London, Outer Metropolitan, Outer South East and East Anglia), which experienced a 0.7% fall. | “House price growth across northern England (North, North West, Yorkshire & Humberside, East Midlands and West Midlands) averaged 2.1%, remaining ahead of that in the south (London, Outer Metropolitan, Outer South East and East Anglia), which experienced a 0.7% fall. |
| Here’s the top line of Nationwide’s house price survey: | Here’s the top line of Nationwide’s house price survey: |
| Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. |
| Britain’s housing market remains in the doldrums, according to a new industry survey which shows London prices have now fallen for eight quarters in a row. | Britain’s housing market remains in the doldrums, according to a new industry survey which shows London prices have now fallen for eight quarters in a row. |
| With demand subdued, and Brexit uncertainty rife, annual house prices across the UK only rose by 0.5% in the 12 months to June, a four-month low. | With demand subdued, and Brexit uncertainty rife, annual house prices across the UK only rose by 0.5% in the 12 months to June, a four-month low. |
| That’s down by 0.6% a month ago, meaning that the slowdown that began after the EU referendum in 2016 is persisting. | That’s down by 0.6% a month ago, meaning that the slowdown that began after the EU referendum in 2016 is persisting. |
| Prices inched up by a sickly 0.1% in June alone, pushing the average price of a UK dwelling to £216,515. | Prices inched up by a sickly 0.1% in June alone, pushing the average price of a UK dwelling to £216,515. |
| The Nationwide Building Society, which compiles the data, says the market is “subdued” -- potentially good news for those trying to get onto the housing ladder, but also a sign of weak economic activity. | The Nationwide Building Society, which compiles the data, says the market is “subdued” -- potentially good news for those trying to get onto the housing ladder, but also a sign of weak economic activity. |
| The slowdown is being driven by action (or lack of it) in the capital and the surrounding area. | The slowdown is being driven by action (or lack of it) in the capital and the surrounding area. |
| London house prices are down 0.7% in the last year, while they’ve declined by 1.8% in the Outer Metropolitan Area (the commuter belt around London) and by 1.6% in the South East. | London house prices are down 0.7% in the last year, while they’ve declined by 1.8% in the Outer Metropolitan Area (the commuter belt around London) and by 1.6% in the South East. |
| Robert Gardner, Nationwide’s chief economist, predicts that the situation won’t change for some time, given economic uncertainty: | Robert Gardner, Nationwide’s chief economist, predicts that the situation won’t change for some time, given economic uncertainty: |
| “UK annual house price growth remained below 1% for the seventh consecutive month in June, at 0.5%. | “UK annual house price growth remained below 1% for the seventh consecutive month in June, at 0.5%. |
| “Survey data suggests that new buyer enquiries and consumer confidence have remained subdued in recent months. Nevertheless, indicators of housing market activity, such as the number of mortgages approved for house purchase, have remained broadly stable. | “Survey data suggests that new buyer enquiries and consumer confidence have remained subdued in recent months. Nevertheless, indicators of housing market activity, such as the number of mortgages approved for house purchase, have remained broadly stable. |
| “Housing market trends are likely to continue to mirror developments in the broader economy. While healthy labour market conditions and low borrowing costs will provide underlying support, uncertainty is likely to continue to act as a drag on sentiment and activity, with price growth and transaction levels remaining close to current levels over the coming months. | “Housing market trends are likely to continue to mirror developments in the broader economy. While healthy labour market conditions and low borrowing costs will provide underlying support, uncertainty is likely to continue to act as a drag on sentiment and activity, with price growth and transaction levels remaining close to current levels over the coming months. |
| More to follow.... | More to follow.... |
| Also coming up today | Also coming up today |
| Data firm Markit publishes its survey of UK construction companies, which will give fresh insight into the building sector. This PMI is expected to rise, but still languish below the 50-point mark showing stagnation. | Data firm Markit publishes its survey of UK construction companies, which will give fresh insight into the building sector. This PMI is expected to rise, but still languish below the 50-point mark showing stagnation. |
| Mark Carney has picked a nice day to visit Bournemouth. But he may not enjoy the seaside - instead, the Bank of England governor is speaking at the Local Government Association Annual Conference and exhibition. We’ll watch for any comments about the housing market, the UK economy, interest rates or Brexit. | Mark Carney has picked a nice day to visit Bournemouth. But he may not enjoy the seaside - instead, the Bank of England governor is speaking at the Local Government Association Annual Conference and exhibition. We’ll watch for any comments about the housing market, the UK economy, interest rates or Brexit. |
| We’ll also track the financial markets, after Wall Street closed at a record high last night. | We’ll also track the financial markets, after Wall Street closed at a record high last night. |
| The agenda | The agenda |
| 9.30am BST: UK construction PMI for June (expected to rise to 49.2, from 48.6, still showing contraction) | 9.30am BST: UK construction PMI for June (expected to rise to 49.2, from 48.6, still showing contraction) |
| 3pm BST: Bank of England governor speaks in Bournemouth. | 3pm BST: Bank of England governor speaks in Bournemouth. |