The Guardian – Bank Of England Deputy Opposes Rate Hike
Jeremy Leaf, north London estate agent, agrees that the rebound in UK house prices in June is “a little surprising”.
He says that current low interest rates helped to push prices up by 1.1% last month, as did is a lack of supply:
‘However, looking forward the shortage of supply and lack of housebuilding are certainly two of the factors supporting the market.
These will need to improve if we are going to see more sustainable growth in housing transactions.
Neal Hudson of Residential Analysts points out that the housing market had a weak start to the year.
Lucy Pendleton, Founder Director of independent estate agents James Pendleton, warns that the housing market faces four threats:
A gentle slide in prices could continue but it’s got less to do with Brexit and more to do with four factors that can be the Four Horsemen of the Apocalypse for markets – inflation, consumer credit, wage growth and mortgage activity – all of which have been dragging their heels recently.
“In May, mortgage approvals hit an eight-month low, wage growth slumped, inflation rose unexpectedly to 2.9%, a near four-year high, and consumer credit also fell dramatically.
“This combination of factors is not fertile soil for house price growth. What I expect to see from those buyers and sellers who don’t have to come to market right away, is the classic wait-and-see wobble as vendors put off selling, and buyers hold out for better deals.
“It’s this wait-and-see approach that can cause short-term falls to become a bit of a self-fulfilling prophecy but solid demand, particularly in urban areas, will cushion any retreat in prices.”