Property Market Monitor: March 2020

Recent housing data released indicates that the housing market has gathered momentum in recent months and the latest house price figures are in line with that trend. In February, the Nationwide House Price Index rose by 2.3% year-on-year, the highest in 18 months. As our chart of the month shows, it is also a continuation of the upwards trend since a trough of 0.2% was reached in September 2019. The number of residential property transactions and mortgages approved for house purchase increased around the turn of the year and surveyors have reported an increase in new buyer enquiries.

Looking ahead, economic developments will remain the key driver of housing market trends, yet we fear the yet-unknown impact coronavirus may have on short-term data.

Chart of the month: The UK house price growth has continued its upwards trend in recent months

Source: Nationwide House Price Index

Market Commentary

• According to the Nationwide House Price Index, annual house price growth continued to edge up in February. It rose by 2.3% year-on-year, the strongest rate for 18 months and the continuation of the trend seen since September 2019. From our conversations with market participants, it appears that the decisive election outcome may have provided a boost to buyers’ and developers’ sentiment.
• The global economic backdrop remains challenging, with the coronavirus outbreak expected to weigh on global activity in the coming quarters. Yet we believe the housing market in the regions remains well supported by strong fundamentals.
• The latest data on dwellings started across the UK regions points to subdued trends [1]. Q3 2019 (the latest quarter for which data is available) shows that the number of dwellings started in England was down by 11% year-on-year and weakest since Q1 2016 (Figure 1). A similar trend was observed in Northern Ireland where the number of dwellings started in Q3 2019 was down by 14% year-on-year (Figure 2). These numbers support the UK’s continued housebuilding challenge

Figure 1: Permanent dwellings started and completed in England

Source: Office of National Statistics (ONS)

Figure 2: Permanent dwellings started and completed in Scotland, NI and Wales

Source: Office of National Statistics (ONS)

We ended February on a very positive note at Blend Network. 177 investors funded £925,000, taking the amount of deals we funded year-to-date to £1,925,000. The three loans funded had 9%, 9% and 8% return p.a. respectively, and two of our loans listed in February got funded within minutes of being listed, pointing to the continued appetite from lenders. We have a number of exciting new loans in the pipeline currently undergoing due diligence. Some of those loans are in advanced stages of the due diligence process and, if approved by our Credit Committee, will be listed on our platform within the next few weeks. So, keep an eye out for the notification in your inbox and make sure you’ve got yourself on AutoLend with your e-wallet topped up, so you don’t miss the chance to lend on our new loans as soon as they are listed.

Keep an eye on our upcoming loans, and make sure you’ve got yourself on AutoLend with .

[1] Source: Office of National Statistics