May’s house price inflation fell to 1.2% in May, below the government’s target of 2% and potentially leading to cheaper property prices in many areas.
London’s June house prices fell at the sharpest rate since the 2008 financial crisis and the cost of buying a home in the capital was -4.4% less in May 2019 than a year ago. At the height of the financial crisis, the previous record fall was -7.0%, according to the Office of National Statistics.
In May 2019, average property prices across the UK increased by 1.2%, a drop from 1.5% in April.
Not all areas are experiencing negative house price inflation but the North East is becoming better value for would-be home owners, with homes in the North Tyneside area dropping by -2.1% to an average £131,000. Gateshead followed closely, with house prices dropping by -1.2% and Newcastle house prices -0.6%. Some areas of the North East have bucked the trend, with house prices in County Durham on the rise and South Tyneside up by nearly 8%.
Several other areas are predicted to experience negative house price inflation soon, or are already showing signs of lower house prices. Independent consumer group for home sellers, The Advisory, predicts imminent price drops in 262 postcode districts. Top ten are:
- TA17 in Somerset, England
- LL43 in Gwynedd, Wales
- NE44 in Northumberland, England
- HU20 in East Riding of Yorkshire, England
- B19 in West Midlands, England
- LS3 in West Yorkshire, England
- LL67 in Gwynedd, Wales
- SA47 in Dyfed, Wales
- BN45 in Sussex, England
- DL11 in North Yorkshire, England
This isn’t great news for people wanting to downsize, release funds or move to a more expensive area. However, it’s not a problem if you simply want to move home in your area and is a positive bonus for those wanting to start out on the property ladder.
This could be a great time for home buyers to nab a bargain, but make sure you don’t get any hidden financial problems by asking a Chartered Surveyor for a building survey when you buy.