Principality Building Society House Price Index Wales, Q1 2019

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1 HOUSE PRICE INDEX Principality Building Society House Price Index Wales, Q Where home matters Data provided by

2 house price growth in Wales subdued The average house price in Wales has fallen in Q by 0.8%, while annual growth rate is at its lowest level since August 2013 at 0.4%. The fall in prices over the last three months is attributed to ongoing uncertainty surrounding Brexit, but house sales remain relatively buoyant, up by 6% in Q vs Q The average house price in Wales is 185, % house price growth -0.8% Quarterly house price decline House sales Q vs Q up Moderate house price growth expected % Tom Denman, Chief Financial Officer at Principality Building Society said: As anticipated, we have seen a quarterly decline in house prices which is connected to the ongoing economic uncertainty caused by Brexit. House sales are up year on year, with Brexit seemingly not having the same negative effect on the number of sales that are taking place in the Welsh housing market as it has in southern parts of England, in particular. The south-east of Wales continues to see house price growth as a result of the abolition of the Severn Bridge tolls and the widening commuter belt between Bristol and Cardiff. With political uncertainty continuing, it s difficult to gauge whether the market will bounce back in quarter two or will continue to show signs of slowing. Market Snapshot During Q1 2019, prices in Wales have fallen by an average 0.8%. The main reason for this decline in prices is the uncertainty caused by Brexit, with many buyers and sellers waiting for a clear decision on the future direction of the country before committing to the purchase or sale of a property. The lack of decisions on the purchase of a property appear to be more prevalent at the higher end of the market, with first-time buyers remaining keen to climb onto the property ladder. In Q there were 15 local authority areas where prices fell in the quarter, and seven where prices rose. Of the seven authorities with positive price changes, three have the lowest average prices in Wales; Merthyr Tydfil (0.5%), Neath Port Talbot (1.9%) and Blaenau Gwent (1.1%). It is likely that in these areas first-time buyers helped to maintain the positive movement in prices over the quarter. Cardiff and Conwy reached new peak prices in March In Conwy it s the average price of detached homes (the most frequently purchased property type in the area) that have seen the largest rise over the last year, up by an average 40,000 from 225,000 in March 2018 to 265,000 in March This has helped to set the new peak average price for Conwy of just over 190,000. In Cardiff the average price of semi-detached properties and flats have helped to set a new peak average price for the area of just over 235,000. The average price of semidetached properties has risen by 15,000 over the last year to 255,000 in March, while the average price of flats has also risen by 7,000 to 157,000 over the same period.

3 Average house prices over last two years - Wales 190,000 Wales Trend 187, , , , , , , ,000 MAR 17 JUN 17 SEP 17 DEC 17 MAR 18 JUN 18 SEP 18 DEC 18 MAR 19 The above graph shows the rise in prices in March 2018 was followed by a fall between April and June 2018, as the number of high-value transactions decreased, having been brought forward into the earlier months to avoid paying Land Transaction Tax that was introduced in April. There were fewer housing transactions during Q but a higher proportion of higher value ones. However, from June onwards prices climbed back in a near straight line to September. This was followed by a period of relatively flat prices from October 2018 to January 2019, with prices dropping in both February and March 2019 reflecting the uncertainties associated with Brexit. Wales transactions Q vs Q Q Q Detached Semi Terraced Flats Total The chart above compares the number of housing sales in Wales during Q1 2019, with the same three months one year earlier. Sales rose by 6% in Q compared to Q There was an increase in sales in Q compared to Q for semidetached and terraced properties by 10.3% and 11.5% respectively, but a decrease in sales for detached properties, down by 0.4% and flats, down by 12.3%. The Brexit effect, whilst prevalent in the southern regions of England, does not yet appear to be having any significant dampening effect on the number of sales that are taking place in the Welsh housing market. The Principality House Price Index for Wales is prepared from dataset provided by Acadata using its methodology. It is published as a secondary source of economic information, but is not intended to be relied on for any commercial or personal decisions and no responsibility is assumed by Principality or Acadata if it is used contrary to that intention.

4 Average annual and quarterly change by local authority 1 Newport 4.5% -1.9% Average change % 22 Anglesey -3.5% -3.5% -4.4% 198,105 2 Cardiff 1.1% 3.8% 235,361 3 Monmouthshire -0.8% -0.7% Average Quarterly Change % , Conwy 5.3% 0.4% 190, Denbighshire -2.0% 2.2% ,963 4 Torfaen 3.9% -1.9% Growth 19 Flintshire -5.8% -7.0% 0.5% 169,196 5 Caerphilly 3.4% -1.6% Decline , Wrexham -3.7% 0.9% 151, ,024 6 Blaenau Gwent 9.8% 1.1% Gwynedd 7.2% -2.5% 7 109,002 Merthyr Tydfil 7.7% 0.5% 126, , Ceredigion 4.7% -1.7% 207,488 8 RCT 6.2% -0.1% 133,905 The Principality Quarterly House Price Index has been prepared by Acadata Ltd for the Principality Building Society. The underlying data used for the house price analysis are supplied by the Land Registry, which records all housing transactions that take place in England and Wales. The data are subsequently mix and seasonally adjusted by Acadata using established statistical procedures. 15 Pembrokeshire 1.9% -2.3% 189,744 9 Vale of Glamorgan 10 Bridgend 11 Neath & Port Talbot 12 Swansea 13 Powys 14 Carmarthenshire -1.0% -0.1% 0.7% -0.1% -3.0% 1.9% -5.4% -0.5% -4.0% -3.6% -1.2% -4.9% 255, , , , , ,260 Contact: Jamie Pike I Corporate Affairs Manager I Tel: I Jamie.Pike@principality.co.uk

5 CALL US VISIT ONLINE (Open Mon Fri 8am 8pm Sat 9am 1pm) To find your nearest branch Principality Building This leaflet is available in large print, Braille and audio tape on request by calling Where home matters To help us maintain our service and security standards, telephone calls may be monitored or recorded. Principality Building Society is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, reference number Principality Building Society, Principality Buildings, Queen Street, Cardiff, CF10 1UA. HPIQ1A4 04/19-1 Data provided by