What's going on?

House prices in the UK did not go up from September to October – the first time in 15 months that prices flatlined (according to influential data from Nationwide). It�s further evidence that the UK housing market has moderately cooled over the past six months or so.

What does this mean?

While house prices stayed flat versus September, they are still up more than 4% over the past year. Furthermore, the amount of property sold in October 2016 was significantly less than in October of last year (by about 10%). However, much of the slowdown might have been due to buyers making purchases at the beginning of this year to avoid new taxes that came in April 2016. So while activity has slowed and house prices aren�t going up as much as they were in previous months, they aren�t falling either (so far, at least…).

Why should I care?

The bigger picture: The impact of the Brexit vote hasn�t really kicked in yet.
So far, the data suggests the UK economy is barely slowing down. But that could change next year as it�s feared that the uncertainty created by the Brexit vote will increase companies� apprehension to hire workers, and people�s budgets take a hit as inflation (and therefore prices) increases. Fewer jobs and lighter wallets would likely make buyers apprehensive and hurt property prices. The flipside is that the weaker pound might lure more international buyers, which would help prices (particularly in London).


For you personally: Housing in London is at a historically unaffordable level.
Over the past three years, house prices increased by about 20% while wages have risen by about 6% (according to Nationwide). This has, to some degree, been offset by lower mortgage rates (due to record low interest rates). But, in London and other areas of the southeast of the UK, a typical mortgage payment as a proportion of people�s pay has hit a record high. In other words, housing in London has never been less affordable. Yay.