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Global wind vane! British house prices fell for the first time in six years

Time: 2018-02-13         Source: Wall Street knowledgeable         Author: Wall Street knowledge

According to a public report by Acadata, a UK housing agency, the UK house price growth slowed by 0.4% in January from a year earlier in January. This is the first time that housing prices have fallen in the UK since 2012. Among them, the decline of 4.3% in London recorded the worst decline since the financial crisis in 2009.

When the chancellor of George Osborne, the chancellor of the exchequer, predicted that the Brexit would allow the housing price in Great Britain to drop sharply and turbulently.

According to a public report by Acadata, a UK housing agency, the UK house price growth slowed by 0.4% in January from a year earlier in January. This is the first time that housing prices have fallen in the UK since 2012. Among them, the decline of 4.3% in London recorded the worst decline since the financial crisis in 2009.

What makes homebuyers even more tormented is that since the Bank raised interest rates last November, the Bank of England said last week that if the UK economy maintains its current operating trend, the Bank of England's benchmark interest rate increase may accelerate. This may also exert further pressure on the property market.

According to a report by Bloomberg on February 8, Simon Rubinsohn, chief economist at RICS (Royal Institution of Chartered Surveyors), said: "Our latest internal analysis shows that housing transactions will remain sluggish in coming months. The record shows that under-supply remains the most critical challenge. "

First fall in six years

Since May last year, the year-on-year rate of increase in UK house prices has dropped for eight consecutive months. In the period from 2012 to 2016, UK home prices growth continued to rise. The highest point of growth in the past six years appeared in August 2014 and again in February 2016 a small high of 9%.

However, since then housing prices in the UK have been declining overall, except for a slight rebound from February to May in 17 and the prices have been accelerating downward since May. This would have reminded us of the continuing impact of the Brexit incident in June.

Former Secretary of the Prophecy

According to a Reuters report of February 17, the largest drop in EU migrants working in the UK for the fourth quarter of 2004 over the same period of 20 years in the fourth quarter shows that the drop in the United Kingdom and the British Pound have weakened the attractiveness of the United Kingdom. While Britain's economy relies heavily on foreign labor and the Brexit event has led to a large outflow of immigrants from the EU, it undoubtedly reduces the demand for home purchase in the UK and London, the largest immigrant city, is the first to bear the brunt.

As early as 2016, the BBC has warned George Osborne, the chancellor of the United Kingdom, warning: "If the people choose to leave the European Union in the June referendum, London property prices may drop by 18%, and the overall economy in the United Kingdom will be hit hard."

More hawkish Bank of England

The Bank of England said on February 9 that in view of the acceleration of global economic growth, the central bank expects to raise interest rates faster than expected last year. This statement may strengthen the central bank or in a few months to raise interest rates again expected. At the same time, the forecast for growth in the UK economy this year will be raised to 1.7% from 1.5% expected in November last year. The expected upward adjustment mainly reflects the general trend of global economic rebound.

Bank of England Governor Mark Carney told the Financial Secretary Philip Hammond in a letter explaining the decision by the central bank that if the future economic situation is generally in line with expectations, it may be necessary to tighten monetary policy earlier and the tightening is more necessary.

This is undoubtedly the future of British real estate worse.

Source: Wall Street knowledgeable

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