London households demonstrate most house price optimism
Households in London perceived the biggest increase in house prices in September, according to the Knight Frank/HIS Markit house price sentiment index.
The survey found respondents from regions across the UK believed prices increased over the course of the month. However the research suggests households in the South and East of England are more confident about price rises than those in the North of England, Scotland or Wales.
Gráinne Gilmore, head of UK residential research at Knight Frank, said: “House price sentiment is mirroring the broader pick-up in confidence after Brexit. This comes as initial data shows a continuing positive picture for both employment and economic output.
“The housing market is now entering the typically busier autumn season, with indications that activity is rising, especially in key urban areas. There is still uncertainty surrounding the next steps of how the UK will move to exit the European Union, and this could create some economic turbulence. Yet the fundamentals of the housing market remain unchanged, underpinned by limited supply and ultra-low mortgage rates. ”
Tim Moore, senior economist at IHS Markit, said: “September data highlights a sustained recovery in house price sentiment from the three-and-a-half year low seen just after the EU referendum. In each of the past two months, UK households’ views have become more upbeat in terms of both current property values and expected prices for the year ahead. There are early signs of a V-shaped recovery in house price sentiment across all UK regions monitored by the survey.
“However, looking through the summer volatility, house price sentiment remains weaker than seen on average in the first half of the year, and well below the peaks seen during spring of 2014.
“As a result, recent survey data indicates that Brexit uncertainty has temporarily dented but not derailed housing market confidence. Moreover, the prospect of low interest rates for longer and an entrenched shortage of housing supply are key factors supporting UK property values.”
