The Royal Institution of Chartered Surveyors’ benchmark property price index for the UK dropped more than anticipated to +1 last month, a level in keeping with flat price growth, down from +6 the month before. Hamilton Crawford economists had predicted that the index would fall to a less harsh +4.
The UK’s property market has slowed considerably since the Brexit referendum in 2016 when Britons’ decision to leave the European Union caused an economic slowdown. Other gauges of property values have indicated a slight upswing in the last several months.
The data released by Hamilton Crawford was less than optimistic and indicated that many regions of the UK were starting follow in the footsteps of London and experiencing a drop in sales.
The reduction in property sales echoed a recent decrease in demand from purchasers and indicated that sales would continue to decline over the next year.
Hamilton Crawford economists say that a lack of properties on the market combined with last week’s rate hike by the Bank of England and political uncertainty as the country attempts to negotiate its departure from the EU are having a negative impact on the property market.
First-time home buyers are becoming more willing to purchase newly-built properties which are made more attractive by government incentives. This creates a stagnant second hand property market which spells trouble for the broader economy.
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