Average property prices in England and Wales are set to rise by 9% between May and August 2019, according to a new ‘early-prediction’ house price index that identifies property price trends months ahead of some of the UK’s leading property price indices.
The new forecast tool, which uses unique insights based on recently agreed house sale prices, reports that the property prices in England and Wales are on track for a ‘remarkable upturn’ this summer, based on sale prices agreed on this spring.
- The average house price in England & Wales was £280,912 in April
- Analysis of agreed sale prices suggests the average house prices in England & Wales house price will rise to £299,300 in July, representing a 9% increase
The new index, the inaugural House Price Forecast from ReallyMoving, a site offering ‘free instant quotes’ for home-moving services such as conveyancing, surveys and removals, predicts a sizeable surge in average prices through May, June and July 2019.
Sellers are growing tired of the ‘wait and see’ approach. Once the Brexit deadline passed at the end of March, with no further clarification, sellers decided to press ahead with their move…
Compared to the reactive, quarterly results from the UK House Price Index (HPI), one of the UK’s most comprehensive house price indices that publishes UK house sales once the purchases have been registered, the new ReallyMoving index is in a better position to report property price trends before they happen, as its figures (although not whole of market) are based on analysis of c.8,000 monthly registrations for conveyancing quotes that are typically received three months before completion, giving users an early prediction of emerging house price trends.
Historically, ReallyMoving’s data has closely tracked the Land Registry’s ‘price paid’ data, published retrospectively to completion, but as you can see on the graph below, the company’s new forecaster is showing the significant rise in prices is already underway while, according to the HPI figures, the upturn is only just beginning to emerge… These early insights could be really useful for property investors to gauge, and react to, market changes before word gets out to the masses via the HPI.
Annual price changes
Annually, prices have been consistently lower than the previous year between January and May 2019. A notable annual drop in values in May 2019 of -6% (see Graph 2) is further evidence that this year the spring market has accelerated later than in 2018, as the traditionally busy spring sales window was delayed by Brexit uncertainty.
However, an increase in market activity later in the spring means annual price changes are forecast to stabilise, with +1% growth expected in June, followed by 0% change in July and -1% in August 2019.
Rob Houghton, CEO of ReallyMoving, commented: “Our forecasts suggest that sellers are growing tired of the ‘wait and see’ approach and once the Brexit deadline passed at the end of March, with no further clarification, sellers decided to press ahead with their move. This new buyer demand and a continued shortage of quality housing stock is on course to drive strong price growth between May and August.”
Regional forecasts
The new index shows that out of the twelve regions in the UK, eleven are forecast to see prices rise during the three months to August 2019, with the strongest gains in the North East (+20.2%), the East of England (+11.7%) and the South West (+12.1% – see the map below), suggesting that almost all of the UK is experiencing growing frustration with the continued uncertainty and deciding to press ahead with a home move. The capital is no exception and although growth is more subdued than in other parts of the country, London is still forecast to see prices rise by +3.1% over the summer period.
“There is considerable pent up demand in the market following three years of uncertainty and with many doubting that Brexit will be resolved any time soon, people are increasingly making the decision to move on regardless,” Houghton added.
