Autumn Bounce Fails to Materialize for U.K. Housing Market

Bookmark

(Bloomberg) -- Asking prices for U.K. homes posted their first September decline in nine years amid the escalating turmoil over Brexit.

They fell 0.2% from August to an average of 304,770 pounds ($380,000), property website operator Rightmove said in a report published Monday. The downturn was most pronounced in London, where prices dipped 2.2%.

While September is usually a busy time in the housing market, there were over 20% fewer properties put up for sale in the capital compared with a year ago, and 7.8% fewer at the national level, according to the report.

“The autumn bounce normally kicks off at the same time as kids go back to school, but this year it’s a late starter at best, and if uncertainty persists then the autumn term could be missed altogether,” said Rightmove Director Miles Shipside. “As we approach yet another Brexit deadline, there are signs that the increasing gnashing of teeth is causing some to hesitate.”

Brexit has plunged the U.K. into a full-scale political crisis, with Prime Minister Boris Johnson vowing to take Britain out of the European Union on Oct. 31 without a deal if necessary. Parliament passed a law this month requiring Johnson to ask the EU for an extension if he fails to get a divorce agreement by Oct. 19 but government lawyers are trying to find ways around it.

Asking prices were just 0.2% higher than in September last year, with southern regions proving a drag. However, a 5.5% drop in the number of agreed sales showed “widespread hesitation” across the country, Rightmove said. The number of properties coming to market was also down in all regions.

A separate report published by Acadata showed that annual house prices were unchanged in August, compared with 2.1% growth a year earlier.

©2019 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.