City house prices rise; Brexit compounds London slowdown: Hometrack

Hometrack data shows that house prices in UK cities grew 3.2 per cent annually in October, leaving the average city dwelling at £255,200.

Last October, the same report scored yearly growth at 6.1 per cent.

Looking at the individual cities covered by the report reveals continued regional variation. Last month, prices in five cities rose by 6 per cent or more annually, whereas this month, that honour belongs to six – Leicester, at 7.7 per cent, Edinburgh, which grew 7.4 per cent, Manchester, at 6.3 per cent, Birmingham, at 6.2 per cent, Nottingham, which recorded 6.1 per cent growth, and Liverpool, totting up 6 per cent.

The lowest growth was seen in Aberdeen, which fell 2.8 per cent, Cambridge, dropping 1.1 per cent and London, where prices fell 0.4 per cent. Bristol, which grew by 2.4 per cent, is next in the table.

The report also makes much of Brexit, the effect of which it says is limited outside of London. It points to a narrowing of discounts as proof, showing that buyers are getting less than 2 per cent in Manchester, while in Liverpool, the gap between the asking price and selling price it is at its narrowest in five years, at just under 4 per cent.

Edinburgh and Glasgow buck this trend most noticeably, attracting premiums of 8.2 per cent and 6.1 per cent, respectively.

In London, however, the story is different, says the report, with the 2016 vote compounding the negative effects of what Hometrack says are primary factors in the continuing slowdown in the capital. The report cites affordability, tax changes and mortgage regulation as the main reasons for the average price of London homes rising by less than 2 per cent since June 2016 compared to the 15 per cent growth seen in other conurbations.

Across the capial the discount to asking price is recorded at 4.8 per cent.

Hometrack insight director Richard Donnell says: “In the very near term we expect market trends to continue until the outlook becomes clearer. Housing markets in regional cities certainly appear to be in more of a business as usual mode while the London market continues to adjust though modest price falls. Our lead housing indicators suggest no imminent deterioration in the outlook for prices or levels of market activity.”

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