House Price Slowdown
UK average house price growth slowed down in April 2016, after a record breaking surge in in the month of March 2016 – caused by the rush to snap up properties before the new and more expensive land tax rules were introduced. March 2016 saw house price growth of 5.7%, and May 2016 saw growth of 4.9%.
Nationwide said there were 165,000 transactions in April 2016, compared to 149,000 in January 2007 – data produced by HMRC (HM Revenue & Customs).
According to RICS (Royal Institute of Chartered Surveyors) the slowdown is thought to be caused by some key changes in the market:
1) New Landlord Regulation.
2) Combined with another recent survey which has suggested commercial property has recently decreased to a record low. They have said demand from foreign investors is the lowest it has been since 2013.
3) Uncertainty over the UK’s position in Europe, where international investors are being put off by the current situation.
Nationwide figures now show the average house price in the UK increased to a record high of £202,436. They have since commented that UK house prices are likely to drop over the coming months, and also predict a very gradual increase thereafter due to new Landlord Regulations, such as changes in tax relief in 2017, affecting the buy-to-let industry, along with the increased land tax, as mentioned above.
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