Average asking prices for residential properties fell during June of this year for the first time since 2009.
June is usually a month in which property buying activity increases across the UK but a variety of different dynamics have apparently dampened the market in recent weeks, according to the property website Rightmove.
Concerns around political uncertainty, inflationary pressures and a restraining of wage growth across the country are understood to have contributed to a relative lack of activity in the residential property market.
Rightmove’s latest figures relate to activity in the weeks prior to the general election on June 8th and apparently showed a drop of 0.4 per cent in average asking prices nationwide in early June.
The same figure for May increased by 1.2 per cent and asking prices haven’t fallen in the month of June since 2009, during what was a particularly turbulent time for the UK’s housing markets.
“The price of property coming to the market had increased in June in every year since 2009, so buyers’ confidence has clearly been affected by inflation outstripping their pay packets and current political events,” said Rightmove director Miles Shipside in a statement.
The UK’s headline rate of inflation increased to 2.9 per cent in May, which put that figure at a new four-year high, with households increasingly seeing their personal finances squeezed and their potential spending power diminished as a result.
Despite the nationwide average asking price for residential properties having fallen during June, prices in most parts of England and Wales were actually found to be still rising.
The numbers for the country as a whole from Rightmove are down due to particularly sharp declines in asking prices in London, where there was a 2.4 per cent fall in June, and in other parts of central and south east England.
Potentially worrying indicators emerged from the Bank of England’s monetary policy committee (MPC) in recent days, with several of its members having voted in June to introduce a rise in the base rate of interest.
A majority of MPC members voted to maintain the cost of borrowing at its current historic low but, with three members voting for an increase, their vote on the subject this month was the closest it has been since 2007.