The UK housing market in five charts

The move towards price moderation has remained largely consistent over the last few months, with the market characterised by modest annual growth of up to 2% since September.

The separate ONS measure of house prices shows how the market remains regionalised, with stronger annual price growth in the Midlands and North of England, as well as in Scotland and Wales, than across the South of England.

There are signs that activity is picking up, with the number of home loans granted for house purchase rising to £4.3 billion in April, higher than the six month average of £3.8 billion, according to Bank of England mortgage lending data.

Some homeowners and agents may be looking beyond Brexit, or are at least reflecting the relief of the Brexit extension. The IHS Markit measure of future house price sentiment, which measures what homeowners believe will happen to the value of their property over the next 12 months, has risen over the last two months, as shown in the chart below.

Even with the political uncertainty around Brexit, the UK’s economy is operating at a better-than-expected pace. Current annual GDP growth of 1.8% in Q1 means that the UK is outperforming other economies.

Buyers in prime central London, meanwhile, are positioning themselves for life after Brexit. The number of offers made in the first three months of 2019 was at its highest level in more than a decade, while new applicant levels were at the highest level for Q1 since 2014. Accordingly, exchanges rose 6% between January and April versus last year, Knight Frank data shows.

In contrast to the central London sales market, prime rents in central London were 0.2% higher over the year to January. The number of tenancies agreed in PCL and POL increased 11% in the year to April versus the previous 12-month period. Demand has risen in recent months as some buyers respond to political uncertainty by renting.

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