Housing unaffordability slows to lowest rate in five years according to the ONS
Property expert and Yomdel CEO, Andy Soloman, commented:
“An almost static movement in the rate of housing affordability is, in some ways, positive news for UK home buyers and one consequence of a bodged Brexit process that we can chalk down as a win of sorts.
However, while the rate of unaffordability has slowed significantly since 2013, this slowdown is coming off the back of five years of a progressive unaffordability which somewhat takes the shine off today’s news.
Of late we’ve seen higher rates of employment, an improvement in wage inflation to outstrip RPI and CPI and a slow in-house price growth, but with the UK market so drastically inflated from years of upward growth, it will take far more than a dose of market uncertainty to relevel the affordability playing field.
It’s far more likely that once the political dust has settled an uplift in demand, spurred by this static movement in affordability, will see the gap widen further and so now is the time to get ahead of the game and get on the ladder before it happens.”
Managing Director of One77 Mortgages, Alastair McKee, commented:
“While the tide is far from turning, the continued affordability of mortgage rates in the UK has gone some way in stemming the flood of unaffordability seen over the previous five years, although the initial financial barrier of a mortgage deposit remains sizable.
The gap between existing and new build properties has also widened, driven largely by an increase in demand from the likes of the Help to Buy scheme amongst first-time buyers.
It’s not often we talk about London as the only region to see an improvement in affordability, but the capital has shown some evidence of this as a result of a drastic rebalancing of house prices since Brexit.
Of course, it’s well worth noting that the region is also home to some of the largest levels of unaffordability due to the high price of property, along with the surrounding markets of the South East and East of England.
Regardless of what happens with Brexit, the chances of our property market DNA showing any signs of change are slim and affordability will remain an issue for years to come, particularly once interest rates start to climb once more.”