UK house price growth is beginning to slow and is now predicted to flat line in 2018.
One of the biggest mortgage lenders, Nationwide, believes this is due to a sharp decrease in London’s prime property market. For 70% of homes valued over £1m, in places like the capital and the South East, there’s been a price cut on the original asking price.
Anxiety over Brexit has also played its part.
With uncertainty over the negotiations to leave the EU and the shock of the recent election still reverberating, investors, particularly overseas, are nervous about the UK’s economic prospects outside the trading bloc.
There’s also the stamp duty rise to consider.
Brought in last year, this has cut demand from buy-to-let landlords who were one of the key driving forces behind rapid price growth.
Many such landlords were pensioners.
With interest rates extremely low, they were withdrawing their savings from pensions and banks, and investing it in property to get better value for their cash.
Similarly, higher inflation and the lack of wage growth has weighed down purchasers’ appetite.
Elsewhere, there’s been a price rise but these are in areas where house prices have not grown as fast. This has been helped by low unemployment, low interest rates and a severe shortage of housing stock.