House prices on the Isle of Wight declined slightly, by 0.4%, in August, despite witnessing a 1.9% rise over the last 12 months.
The latest data from the Office of National Statistics shows that the average property in the area sold for £210,428 – below the UK average of £232,797.
The average homeowner on the Isle of Wight will have seen their property jump in value by around £34,000 in the last five years.
Average price for first time buyers
The figures also showed that buyers who made their first step onto the property ladder on the Isle of Wight in August spent an average of £171,206 – around £27,000 more than it would have cost them five years ago.
National comparison
Across the South East, property prices have risen by 1.9% in the last year, to £329,264. The region underperformed compared to the UK as whole, which saw the average property value increase by 3.2%.
The data comes from the House Price Index, which the ONS compiles using house sale information from the Land Registry, and the equivalent bodies in Scotland and Northern Ireland.
The Brexit effect
Lawrence Bowles, associate director of the research team at estate agents Savills, said the uncertainty over the outcome of Brexit negotiations was fuelling a “tougher lending environment”.
He said:
“House price growth in real terms is slowing, and inflation is growing at the rate we’ve been used to over the last few months. Buyers, sellers and lenders are all thinking maybe they should wait until they see the outcome of negotiations.
“Longer term, the issue we expect to see is affordability, as we expect the Bank of England base rate to be back above 2% by 2021 – closer to historical levels, rather than the ultra-low rates we have seen in recent years.
“That, combined with stricter affordability stress tests, will make it more difficult for households to demonstrate that they are able to afford mortgages.
“But we would expect to see a bounce at some point, between finding out the Brexit outcome and the start of higher interest rates.”
Sales on the Island rise
Between July last year and June this year, the most recent 12 months for which sales volume data is available, 3,004 homes were sold on the Isle of Wight, 1% more than in the previous year.
The highest house prices in the country in July were found in Kensington and Chelsea, London, where properties sold for an average of £1.35 million – 16 times the cost of a home in Burnley, where the average property cost just £85,900.
Article shared by Data Reporter as part of OnTheWight’s collaboration with Press Association and Urbs Media
