The latest data released by Principality Building Society has revealed that average house prices in Wales have fallen to £185,018, with the annual growth sliding to 0.4% the lowest since August 2013.
However, according to the figures, house sales were actually up by 6% during Q1 compared to the same period a year earlier. The Society suggests that first-time buyers are making the most of the opportunity of relatively affordable house prices in parts of Wales.
House prices across the country have fallen by an average of 0.8% in Q1 of 2019. According to Principality’s House Price Index for Wales, the decline in quarterly prices has been caused by uncertainty surrounding Brexit, with many buyers and sellers waiting for a clear decision on the future of the country’s position in Europe before committing to the purchase or sale of a property.
Annual house price growth is low compared to the same period last year due to the sales of more expensive properties ahead of the introduction of the Land Transaction Tax in April 2018, which resulted in a rise in stamp duty for mid to high end priced homes.
Overall, there were 15 local authority areas in Wales where prices fell in the quarter.
Seven local authorities saw a rise in house prices, however, including the more affordable regions of Neath Port Talbot (1.9%), Blaenau Gwent (1.1%) and Merthyr Tydfil (0.5%), which Principality suggests has been helped by first-time buyers remaining keen to get on the property ladder in those areas.
Tom Denman, chief financial officer at Principality Building Society said, “As anticipated, we have seen a quarterly decline in house prices which is connected to the ongoing economic uncertainty caused by Brexit.
House sales are up year on year, with Brexit seemingly not having the same negative effect on the number of sales that are taking place in the Welsh housing market as it has in southern parts of England, in particular. The south-east of Wales continues to see house price growth as a result of the abolition of the Severn Bridge tolls and the widening commuter belt between Bristol and Cardiff. With political uncertainty continuing, it’s difficult to gauge whether the market will bounce back in quarter two or will continue to show signs of slowing.”
Cardiff (£235,361) and Conwy (£190,125) reached new peak prices in March 2019. In Cardiff, this was driven by a rise in the prices of semi-detached properties and flats. In Conwy, detached homes, the most frequently purchased property type in the area saw the largest rise, up by an average of £40,000 in March 2019 compared to the year previous.