The latest data released from the Nationwide Building Society shows UK house prices slowed in April, following a surge in activity during March.
Annual house price growth was revealed to have slowed to 4.9% in April, in the comparison to 5.7% recorded in the last month.
Slow growth
April has seen house price growth of just 0.2%, which is the lowest monthly rise since November 2015.
In addition, the Royal Institution of Chartered Surveyors has also suggested that demand for commercial property has dropped to a record low. The institution concluded that international investors have been deterred by the uncertainty caused by the pending EU referendum.
Nationwide noted that April’s slowdown in house prices comes after the highs in March, which were caused by residential landlords rushing to beat the additional stamp duty deadline.
During March, there were 165,400 transactions, according to official data from HM Revenue and Customs.
Robert Gardner, chief economist at the Nationwide, said, ‘it may be that the surge in house purchase activity resulting from the increase in stamp duty on second homes from 1 April provided a temporary boost to prices in March.’[1]
Highs
Figures from the report show that the average price of a flat or UK increased to a new high of £202,436 in April.
Gardner observes, ‘house purchase activity is likely to fall in the months ahead given the number of purchasers that brought forwards transactions. The recovery thereafter may also be fairly gradual, especially in the buy-to-let sector, where a wealth of other policy changes, such as the reduction in tax relief for landlords from 2017 are likely to exert an ongoing drag.’[1]
House price growth slows in April
Uncertainty
The survey from RICS underlines that uncertainty being created by the Brexit vote. RICS said that demand from foreign investors for UK commercial property is at its lowest for three years.
Simon Rubinsohn, chief economist at RICS, feels, ‘there is no doubt that since the EU referendum became a certainty following the general election last May, we have seen a decline in interest from overseas investors in UK commercial property.’[1]
‘At least in the short-term, we know that international retailers and service providers are finding the UK market less attractive,’ he added.[1]
[1] http://www.bbc.co.uk/news/business-36153571