UK construction shrank at its fastest pace since 2009 after the UK voted to Leave the EU in June.
The figures offer little comfort to prospective homeowners after a damning report from the Resolution Foundation revealed that home ownership has fallen to its lowest level for 30 years. The research shows supply has failed to keep pace with demand in the UK, shutting buyers out of the market.
Slowing house prices are helping first-time buyers
Slowing house price growth since the vote for Brexit vote is helping first-time buyers get on to the property ladder, according to the National Association of Estate Agents (NAEA).
After falling in September, the proportion of homes bought by first-timers last month hit 32 per cent – a rise of nine per cent to the highest figure since records began in 2000, says The Times.
In the wake of reports from Nationwide and Halifax showing rapid house price growth cooling, added the paper, “Mark Hayward, managing director of the association, said that this could be down to… houses appearing more affordable to buyers”.
First-time buyers are also benefitting from record lows for mortgage rates and a return of 100 per cent loans, including one launched by a regional building society this week using the homes of the buyers’ parents as security.
Market Harborough Building Society’s “family assistance mortgage” follows Barclays’ 100 per cent “family springboard mortgage”, which similarly uses parents’ deposited cash as security.
While house prices are slowing, they are still rising, in defiance of analyst predictions prior to the EU referendum. The NAEA report suggests this will continue.
The number of properties being offered for sale grew 7.5 per cent to 43 per estate-agent branch, offering a welcome sign of confidence returning since the Brexit vote.
But at the same time, the number of buyers seeking a property rose 32 per cent to 440 per branch, the highest since February. There are now more than 10 prospective buyers for every house for sale in the UK.
A shortage of supply is constantly cited as the main reason for consistent house price rises in recent years.
“After shrugging off the uncertainty, we have seen an increase in supply and a rise in the number of sales to [first-time buyers] this month – proof the market is beginning to bounce back,” Hayward said, reports FTAdviser.
“Clearly what we need now, though, is a clear plan as to how the government is going to tackle the chronic shortage of homes that we are facing.”
WE NEED CERTAINTY OVER WHAT BREXIT REALLY MEANS AND WE NEED TO BUILD MORE HOUSES NOW!