Halifax predicts house price stability in 2019
House prices are set to remain stable this year – as long as Britain exits the European Union with a deal – according to leading lender the Halifax.
The bank’s end of year report predicts that prices will grow by between 2% and 4%. However, it warns that the biggest long-term issue for the housing market is addressing the challenges faced by ‘generation rent.’
The report asserts that the UK housing market performed in line with expectations in 2018, in spite of continued uncertainty over Brexit. It claims that prices will remain stable in 2019, with the on-going shortage of homes for sale, and low levels of house building, continuing to support high prices.
However, the Halifax warns that stability will be dependent on the final outcome of Brexit negotiations, as its predications were made on the basis that the UK exits the European Union with a withdrawal agreement and managed transition period.
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According to Russell Galley, managing director of the Halifax: “The housing market in 2018 followed a similar trend to recent years. In line with our expectations, house price growth slowed whilst building activity, completed sales and mortgage approvals all remained relatively flat.
“This was driven by a combination of continued uncertainty regarding the future growth prospects of the UK economy, and the ongoing challenge faced by prospective buyers in building up the necessary deposits.
“Looking ahead, aside from the obvious political and economic uncertainty, the biggest issue for the housing market in 2019 will be the degree to which mortgage payment affordability changes. Average pay growth is likely to gather pace but, with a further interest rate increase also predicted, house prices are unlikely to be pushed significantly in either direction.
“Longer term, the most important issue for the housing market remains addressing the affordability challenge for younger generations through more dynamic house building.”
Read more about this story on the property wire website.