UK Housing Market Growth Downgraded by Bank of England

UK Housing Market Growth Downgraded by Bank of England

The Bank of England has taken into consideration the extension of Brexit and the impact it will have on the housing market. It has released a change in the forecast of the average house price for 2019 to decline by 1.25%. The change is different from the previous forecast of growth by at least 0.25% for the year made in February.

It is unknown what the real impact of Brexit has been on the market and on the confidence of hopeful home buyers.

Recent reports have shown that first time buyers are returning to the market due to lower house prices. However, there are months yet to go until it is discovered if the usual spring season boost occurred as it normally does to give the housing market life despite other factors influencing it.

Experts do believe that home movers are staying put. Rather than taking the step to upgrade or downgrade their current property they are choosing to wait it out and see how much of a toll Brexit takes on the economy and the market. Instead, they are choosing to remortgage and take advantage of the still low interest rates available from lenders.

The housing market is also slowed by the stamp duty hikes that have held back investors and possible holiday home buyers. Landlords are noticeably absent from the market with reporting that buy-to-let mortgages are close to 40% lower than reported in 2015 as the motivation to add to one’s portfolio is less attractive.

There is also evidence that home sellers are being more aggressive to sell and that, too, should help boost the housing market even if the supply of new homes coming to the market is slower than buyer demand would like.

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