Homeowners believe house prices have dropped in last month

Households across the UK believe their property values slipped in July during the aftermath of the EU referendum, according to Knight Frank.

The consultancy’s house price sentiment index, which measures what households think will happen to the value of their property over the next year, fell to 48.3 in July from 59.7 in June.

Some 11.2% of the 1,500 households surveyed across the UK said that the value of their home had risen over the last month, while 14.6% said that prices had fallen.

It is the first time the HPSI has fallen below 50, the index reading that points to no change in prices, for the first time since February 2013.

Households in all regions, barring the south-east and the east of England, perceived that the value of their home dipped in July, with the biggest loss of momentum coming in London.

The poll of 1,500 households was taken between July 14 and 18 and so gives a sense of the post-Brexit vote property market.

While households were negative about the past month, householders were rather more confident, predicting prices rising over the next 12 months.

This aspect of the index fell to 50.3 in July from 67.7 in June. This is the lowest reading recorded by the index since October 2012, indicating that households expect more modest rises in the value of their home than any time in the intervening years. However, while the sentiment index has fallen, the expectation is still for positive, albeit modest, growth over the next year.

Gráinne Gilmore, head of UK residential research at Knight Frank, said: “The impact of uncertainty in the wake of the Brexit vote is clear from the HPSI index reading for July, especially in light of the relative strength of sentiment in the run-up to the vote. Although there has been a marked drop in the index, the readings are hovering around the ‘no-change’ mark, similar to levels in 2012/2013.

“As well as geographical variations, there are wide differences in expectations depending on age groups, with those aged over 55 expecting the value of their home to dip over the next 12 months as well as those aged 18 to 24. All other age groups expect prices to rise modestly.”

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Written by: Houseladder