2.54am EST 02:54 Despite this month’s rise in prices, UK house price inflation is still sharply lower than before the EU referendum. Back in 2016, house prices were rising at around 5% per year, not the sub-1% growth seen in 2019. UK house price inflation Photograph: Nationwide Basic pay growth hit 4% this year, meaning
Despite this month’s rise in prices, UK house price inflation is still sharply lower than before the EU referendum.
Back in 2016, house prices were rising at around 5% per year, not the sub-1% growth seen in 2019.
Basic pay growth hit 4% this year, meaning the price/earnings ratio has dipped. But it’s still sharply over its long-term average (making it much harder for young adults to get onto the housing ladder, compared with earlier generations)
Introduction: UK house prices pick up
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After months of being dampened down by economic and political uncertainty, Britain’s housing market may be flickering back to life.
House prices rose by 0.5% in November, according to the latest survey from Nationwide. That’s the strongest monthly growth since July 2018, up from just 0.2% in October.
On an annual basis (a better measure), prices are up 0.8% compared with November 2018, as buyers shrug off the uncertainty over who will be in Downing Street after 12 December.
That’s the strongest year-on-year increase since April, but still weaker than in 2018 when prices were rising by over 2%. It means the average property is now worth £215,734.
House prices have now been rising by less than 1% for a whole year, below the rate of inflation and wage growth. That should make property slightly more affordable (or slightly less unaffordable?) for first-time buyers and those looking to trade up.
Prices are currently below the record high of £217,663 set in July:
Robert Gardner, Nationwide’s Chief Economist, says the confusion over Britain’s exit from the EU has weighed on the housing market.
“Annual house price growth remained below 1% for the 12th month in a row in November, at 0.8%, though this was the strongest outturn since April.
Indicators of UK economic activity have been fairly volatile in recent quarters, but the underlying pace of growth appears to have slowed as a result of weaker global growth and an intensification of Brexit uncertainty. To date, the slowdown has largely centred on business investment, while household spending has been more resilient.
More details to follow…..
Also coming up today
It could be a quiet day in the markets, with American traders away celebrating Thanksgiving.
Investors may be more nervous about the USC-China trade talks, after Donald Trump signed two US bills supporting Hong Kong’s pro-democracy protesters. That’s a rebuff to China, which had urged the president to block the legislation.
- 10am GMT: Eurozone business climate survey
- 1pm GMT: German inflation for November