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The Masked Tulip

Welsh Housing Fears Over Cuts

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HOUSE prices in Wales could fall faster than anywhere in the UK as austerity measures start to bite, experts predicted yesterday.

Releasing its latest house price figures today, property website Rightmove says a combination of tax rises, public spending cuts and properties flooding on to the market following the abolition of Home Information Packs means asking prices will fall in the coming months, putting an end to any recovery in the housing market.

But the Federation of Small Businesses (FSB) in Wales says the drop in prices here is likely to be greater than elsewhere in the UK because of the Welsh economy’s dependence on public-sector jobs.

Government spending in Wales accounts for 70% of Welsh Gross Domestic Product.

According to today’s figures, house asking prices rose across the UK by just 0.3% from May to June, compared to a rise of 2.6% in April.

But in Wales, prices fell by almost 1% in June. The average asking price in Wales now stands at £168,951.

Asking prices across the UK are already falling in real terms.

Mr Lawson said: “We have to remember that Wales starts from a very low base – our GDP is traditionally very low compared to the rest of the UK.

“We’re usually lumped in there with the north-east of England and Northern Ireland. So when you’re coming from a very low base anyway and you have more of a reliance on the public sector, and there are public sector cuts, obviously that means we’ll be hit harder.”

Asking prices in Wales have risen just 0.4% over the past year, according to Rightmove, significantly below RPI.

Nigel Jones, director of South and West Wales estate agents John Francis, said if the confidence of public-sector workers was knocked by the emergency Budget, it could impact on the market.

But he said in spite of the dominance of the public sector in Wales, the housing market here was strong enough to absorb local government job losses and pay freezes.

He said: “If there’s a high level of redundancies, that will potentially affect property prices, but we don’t know what’s coming out on Tuesday yet.

“We’re not expecting prices to drop, but we’re expecting them to remain fairly flat for the rest of the year.”

Today’s figures also show a 22% jump in the number of people putting their home up for sale, following the abolition of HIPS. Rightmove said there was now increased competition among sellers and a slowdown in the number of potential buyers which contributed to slowing house prices.

Another who thinks that a country whose GDP is 70% dependent upon Public Sector jobs with a coming cull in Public Sector jobs will not suffer, including house prices, is not living in the real World IMPO.

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  • 396 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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