Prime property outside the city of London increased only slightly during the second quarter, which indicates less of a surge in activity compared to the expectation during the post-election period. UK buyers are still sitting on their heels and hesitating before going through with major decisions regarding property purchases.

According to the latest data released by real estate firm Savills, most regions outside London are experiencing less than normal upward pressure on pricing. Lower demand is causing prices to remain sedentary as opposed to many properties in London where pricing continues to move higher.

The Savills report continued with an explanation of the ripple effect, saying: “For the time being this has slowed the ripple effect, despite the significant value gaps between London, the commuter zone and beyond, which would normally drive a flow of demand through the different segments of the prime housing market at this stage in the cycle.

As a result, annual price growth in the prime regional markets stands at a subdued 1.6% on average.”

The report continued to explain how the market could be stifled a bit by tax inhibitors, saying: “In London and at the top end of the country market, the increased cost of stamp duty, following the Autumn statement of December 2014, remains a barrier to both price growth and activity.”

Remortgage activity within the capital city, as well as other regions of the UK, is booming and is expected to continue through the end of the year. This surge has been prompted by the probable increase in the base rate coming by the end of the year.