Leading lettings and sales agent, Benham and Reeves, has released the latest of its very own quarterly house price index based on data from the top four existing indices, looking at where the average house price sits and how the gap between buyer and seller expectation and actual sales has changed.
The Benham and Reeves House Price Index combines data from the four leading industry indices to give a singular figure of how the UK market is moving based on both buyer and seller sentiment, as well as looking at the difference in these indices and what they reveal about the state of the current market.
Current property values
The latest index from Benham and Reeves for Q4 2019 shows that the current overall average UK house price is sitting at ÂŁ251,912 having dropped marginally by -0.2% on the previous quarter, although prices were up by 1.4% on an annual basis.
In London, the average property value also dropped marginally to ÂŁ511,166, down -0.4% on the previous quarter, down -0.7% on an annual basis.
Seller and buyer expectations show signs of alignment
The latest quarterly data from Nationwide and Halifax shows that the amount UK buyers are committing to borrowing has increased slightly by 0.31% to ÂŁ225,188. At the same time, the average asking price has fallen by -1.02%, while sold prices are up 0.4% to ÂŁ234,167.
Despite a market bounce following the election, it’s clear that months of Brexit uncertainty have seen the expectation gap between buyers and sellers close. The gap between buyer expectation and asking prices dropped -1% in Q4 to 35%, while there was also a -1% decrease between asking price and sold price, down to -23%.
However, in London, this gap remained consistent with a 33% increase between the price at which buyers were being approved for a mortgage and the asking price expectations of UK sellers, while there was a -22% drop between this asking price and the average sold price.
“It’s only natural that asking prices will remain at a higher level than the average mortgage approval or sold price but it’s interesting to see that months of Brexit uncertainty had started to bring this difference in buyer and seller expectations closer together.
As buyers committed to slightly more in the way of a mortgage approval price to take advantage of lower market values and lower interest rates, sellers realised they had to lower asking expectations to secure a deal in tough market conditions. This also translated to a smaller gap between asking price and the sold price accepted.
However, with a huge spike in activity following December’s election, we will no doubt see asking prices start to lift once again, as UK sellers look to take advantage of returning buyer demand.
While this asking price expectation will always be higher than the reality of the average sold price, an optimistic increase in a stronger market places sellers in a better position to negotiate a stronger sale price before accepting an offer.”
Benham and Reeves House Price Index
UK
Year
Quarter
Average House Price
Quarterly Change
Annual Change
2018
Q1
ÂŁ245,074
–
–
Q2
ÂŁ248,245
1.3%
–
Q3
ÂŁ250,244
0.8%
–
Q4
ÂŁ248,513
-0.7%
–
2019
Q1
ÂŁ247,463
-0.4%
1.0%
Q2
ÂŁ251,682
1.7%
1.4%
Q3
ÂŁ252,487
0.3%
0.9%
Q4
ÂŁ251,912
-0.2%
1.4%
London
Year
Quarter
Average House Price
Quarterly Change
Annual Change
2018
Q1
ÂŁ519,238
–
–
Q2
ÂŁ520,412
0.2%
–
Q3
ÂŁ517,059
-0.6%
–
Q4
ÂŁ514,976
-0.4%
–
2019
Q1
ÂŁ504,731
-2.0%
-2.8%
Q2
ÂŁ512,193
1.5%
-1.6%
Q3
ÂŁ513,180
0.2%
-0.8%
Q4
ÂŁ511,166
-0.4%
-0.7%
UK
Year
Quarter
Mortgage Approvals Price
< Difference >
Asking Price
< Difference >
Sold Price
2018
Q1
ÂŁ218,231
37.8%
ÂŁ300,684
-25.4%
ÂŁ224,319
2018
Q2
ÂŁ219,116
40.4%
ÂŁ307,745
-26.3%
ÂŁ226,869
2018
Q3
ÂŁ221,959
37.4%
ÂŁ305,060
-24.1%
ÂŁ231,438
2018
Q4
ÂŁ220,522
37.1%
ÂŁ302,239
-23.8%
ÂŁ230,274
2019
Q1
ÂŁ221,578
35.6%
ÂŁ300,481
-24.3%
ÂŁ227,608
2019
Q2
ÂŁ225,987
36.2%
ÂŁ307,691
-25.5%
ÂŁ229,276
2019
Q3
ÂŁ224,490
36.5%
ÂŁ306,321
-23.6%
ÂŁ234,074
2019
Q4
ÂŁ225,188
34.6%
ÂŁ303,182
-22.8%
ÂŁ234,167
London
Year
Quarter
Mortgage Approvals Price
< Difference >
Asking Price
< Difference >
Sold Price
2018
Q1
ÂŁ473,776
30.8%
ÂŁ619,905
-23.1%
ÂŁ476,653
2018
Q2
ÂŁ468,845
34.0%
ÂŁ628,174
-23.8%
ÂŁ478,555
2018
Q3
ÂŁ468,544
31.2%
ÂŁ614,537
-21.9%
ÂŁ480,090
2018
Q4
ÂŁ466,988
31.5%
ÂŁ614,044
-22.4%
ÂŁ476,273
2019
Q1
ÂŁ455,594
32.8%
ÂŁ605,178
-22.9%
ÂŁ466,356
2019
Q2
ÂŁ465,722
32.7%
ÂŁ618,232
-24.5%
ÂŁ466,683
2019
Q3
ÂŁ460,686
33.1%
ÂŁ612,967
-21.9%
ÂŁ478,594
2019
Q4
ÂŁ458,363
32.9%
ÂŁ609,315
-21.5%
ÂŁ478,227
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About the Author
Established in 1958, Benham and Reeves is one of London’s oldest, independently owned property lettings and sales agents. With specialism in residential sales, corporate lettings and property management in prime areas of London, the company operates from 21 prominently located branches and 14 international offices.