As UK house prices took a slight downward trend in February, there were small murmurs in the market that this was the start of something big. Of course, we can’t read a great deal into anything based on the figures of one single month.
However, there are many reasons to suggest that the current figures released by the Nationwide Building Society show that there was a small drop month on month is house prices. But this is still part of a trend that shows annual growth.
Predicting how this might look in the future isn’t easy but it looks bright to most market watchers.
The Factors At Play
As Brexit progresses, the way that the overseas market views UK property will change.
The view will be more ‘wait and see’ than ‘let’s act now’ but in the long term, investors will be back. They may sit on their hands for a while, but the attraction of UK property remains strong globally.
The weather was pretty abysmal throughout February and finished with a bang, as a front from Siberia and a storm off the Atlantic brought huge amounts of snow.
This saw market activity slow to a halt – and it will affect some of the figures for early March too. But Spring is on the way (official date is 20th March) and this will start the first selling season of the year with Easter coming early.
How Do Nationwide View The Report?
The organisation that has compiled the report always makes a few comments to back up the figures, and their view of them.
The Chief Economist of Nationwide, Robert Gardner says, “Subdued economic activity and the ongoing squeeze on household budgets is likely to exert a modest drag on housing market activity.”
View this as a lender looking ahead with caution, in a climate where mortgage approvals are at a relatively low level.
Let’s look forward to a bounce in March and on to a stronger year.