Check out our latest economic review for December.

Our latest edition reads that the latest consumer price statistics reveal a significant drop in
the UK headline rate of inflation, although the BoE Governor has warned that getting the rate to continue falling back to target will be “hard work.”

Data published last month by the Office for National Statistics (ONS) showed the Consumer Prices Index (CPI) 12-month rate – which compares prices in the current month with the same period a year earlier – stood at 4.6% in October. This represents a significant fall from September’s 6.7% figure and was below analysts’ expectations which pointed to a rate of 4.8%. ONS said the decline, which was the largest monthly drop since April 1992, was mainly driven by a steep reduction in household energy bills compared to last year’s levels. There was also some evidence of a wider softening of price pressures, with some sectors, such as overnight hotel accommodation, witnessing a notable easing in annual inflation rates.

You will aslo read about Revised forecasts from the Office for Budget Responsibility (OBR) suggesting the UK economy is set to grow more slowly over the next two years than previously predicted.

Chancellor Jeremy Hunt unveiled the independent fiscal watchdog’s latest projections during his Autumn Statement delivered on 22 November. The updated forecast predicts the economy will expand by 0.6% this year and then by 0.7% in 2024 and 1.4% in 2025. While the 2023 figure is a
significant improvement on the OBR’s previous prediction of a small contraction, the other two figures both represent large downgrades.

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The M.E.C Mortgages residential property review is out now! 

 

Click here to read more about this months residential property review:

includes guides to property values, stats and more.

 

Supply still lagging demand

Steady buyer demand and a sixth successive month of net negative new instructions, were the stand out trends in the September UK Residential Market Survey published by the Royal Institution of Chartered Surveyors (RICS).

At the national level, new buyer enquiries had a net balance of zero in September, up from -13% in August. Meanwhile, the recent decline in new listings persisted,with new instructions registering a net balance of -35%.

Simon Rubinsohn, RICS Chief Economist, commented, “The imbalance between demand and supply remains the most striking theme… And feedback from members provides little reason to believe this issue will be resolved anytime soon.”

Following a slight dip caused by the tapering of the Stamp Duty holiday, steadier buyer demand is now causing sales expectations to gain momentum, with 11% more respondents anticipating an increase in sales in the coming three months, up from +6% in August.

Indeed, with over one million homes sold by the end of August – a threshold not usually passed until October – analysts are
suggesting 2021 could see more transactions completed than in any year since the global financial crisis.

Rents surge nationwide

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