In the last few months, the price of houses grew in a number of European cities as the construction activities amplified where the construction inflation continues to grow (International Construction Market Survey 2019). The construction inflation grew 2.1 percent in London where the price of homebuilding grew at an average rate of £2,880 per m2. Brexit has been a major drag for the real estate markets in the UK where the average property booking was low in the month of February and March, as per RICS reports, but the average asking price of homes increased in April, resulting in one of the biggest month-on-month uplifts.
Across Britain, the average price of the new properties gained 1.1 per cent or by £3,447, in April, as per Rightmove. The property analysts believe the homebuyers are bored of the stagnation and supply constraints, where there exists a lack of attractive properties and this has been driving rates. As per the data from HMRC, the number of transactions increased, on an average, on a yearly basis, where it was found that 101,830 residential transactions were made in March with the rise on of 1.4 per cent month-on-month and 6.8 per cent per annum. Also, there were 11,210 non-residential transactions that took place last month - equivalent to 8.9 per cent growth on a monthly basis.
The property analysts claim it is normal to see an increase in momentum in the property markets in the month of April, where one of the biggest increases in transactions was seen this year, since April 2016. The political situation continues to be a reason for holding back the market where a rise in asking rates is supporting sales- but the number of offers for sale and the final number of sales are low to 2018.
Overseas investments continues to grow
Overseas demand in the UK properties continues to grow where a number of buyers from South Africa are moving abroad to reduce investment portfolio risks. South Africa is facing one of the worst situations with growing unemployment and tough to fix economic situations. Many from the country are investing outside for diversification to get safer returns. UK properties seem attractive as the market continues to deliver higher returns, in the terms of, rents and growth, where the local government policies are supportive of such investments and the UK law is often regarded the most reliable. The market is driven by housing shortage where the house building is below the level required to fulfil the local demand and the supply-demand imbalance continues to create pressure.
Currently, the market amidst unpredictable political factors and the decline in currency rates favors buying at a lower price and it continues to deliver 2.8 per cent in 12 months to February 2019, where the prices have been increasing 5.9 per cent month-on-month and the growth has been strongest in regions outside capital in the North West.
The number of students enrolling for higher courses continues to grow at the rate of 36 per cent as some of the cities have world class reputation for the higher education. Hence, the property market remains positive in terms of overseas investments.
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