LONDON (Reuters) – British home costs recorded modest progress final month, although they’re nonetheless falling in London the place costly property is struggling to promote for its asking worth, an business survey confirmed on Thursday.
The Royal Institution of Chartered Surveyors’ home worth survey held at +eight in December, beating economists’ expectations in a Reuters ballot for it to slide to +5 and contrasting with renewed experiences of falling costs from mortgage lender Halifax on Wednesday.
Annual home worth progress has slowed to round 2-Three p.c since June 2016’s vote to depart the European Union, although this masks widespread regional variations, with London and neighbouring areas seeing probably the most weak spot.
“Divergent regional trends remain very much to the fore with the market in many parts of the country still actually behaving in a solid if unspectacular way despite the downbeat headlines,” RICS chief economist Simon Rubinsohn mentioned.
This is just not the case in central London, the place property is hardest to afford relative to native wages and the place RICS mentioned costs have been falling virtually as quick as in November, when it recorded the broadest worth falls since 2009.
Property priced at 1 million kilos or extra – which is concentrated in London – was failing to promote at its asking worth in two thirds of instances. Typically, reductions of 5-10 p.c have been wanted for it to promote, RICS mentioned.
Across Britain, new directions to promote property fell by probably the most since May 2017, reflecting a slowdown within the market additionally seen in Bank of England information final week, which confirmed new mortgage approvals at a three-year low.
RICS mentioned its members anticipated costs to be flat at a nationwide degree over the subsequent three months, however to rise over the course of the 12 months in all places besides London.
Even in London, the anticipated decline over the subsequent 12 months was smaller than had been predicted earlier than, RICS added.
Economists polled by Reuters on the finish of final 12 months on common forecast that costs would develop by 1.Three p.c in 2018, however fall zero.Three p.c in London.
Credit scores company Standard & Poor’s predicted on Wednesday that costs would rise by zero.5 p.c this 12 months and 1.5 p.c in 2019, as a squeeze on family incomes from excessive inflation and sluggish wage progress proved gradual to ease.
Reporting by David Milliken, enhancing by Andy Bruce