Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Tuesday, 20 September 2016

Post-Brexit bounce (Bottoms up!)

UK confidence rebounds

Rightmove’s House Price Index recorded the average UK asking price as rising by +0.7 per cent or an increase of +£2,277, having fallen by 2 per cent over the preceding two months.

Of course, the price of property coming to market is not the same thing as properties actually selling, but nevertheless Rightmove reported a “broadly positive” result as the market “continues to shrug off post-Brexit uncertainty”.

Although price growth has slowed first homebuyers are in danger of being “marooned” according to Rightmove.

Rightmove reported a monthly jump of +£6,240 or +3.3 per cent for newly-marketed properties of two bedrooms or fewer (with new seller asking prices in this sector up by +10.5 per cent over the past year).

‘It’s a deal, it’s a steal, in fact…’

Well, it’s not quite sale of the century just yet.

In London punitive stamp duties have sent the prime central sector from star pupil straight to detention with average asking prices now lower over the year.

As expected, joint top of the class sit the cheaper London boroughs of Croydon (+11.0 per cent) and Barking & Dagenham (+11.0 per cent).

However, asking prices in salubrious Kensington & Chelsea are now down by -11.7 per cent over the past year, although at £2,054,707 average asking prices remain far from a steal.

Premium markets tend to be illiquid and the journey can be volatile.

Average asking prices are also down year-on-year in Westminster and Richmond Upon Thames.

Overall asking prices in London rebounded by +1.9 per cent in the month or +£11,565, after four consecutive monthly falls.

Outer London prices remain up by +5.3 per cent over the past year.

The fastest annual growth was recorded in the East of England (+7.9 per cent) and South East (+5.7 per cent).

The wrap

I wouldn't want to draw too many conclusions from an asking price index.

Clearly inner London's prime central market is suffering from stamp duty changes, regardless of any Brexit impact.

Elsewhere, there could be a bounce in confidence, albeit on low volumes.