Rics House Price Data Suggests We Could Be In For a Hard Time

Thursday, 17th January 2019 10:47 - by Rajan Dhall

The latest report from RICS shows that Brexit and general market conditions show that sales and prices are easing leading into the March Brexit deadline. Yes, this could be a catalyst for the decline but in my opinion, it is much needed. Prices have fallen at their fastest rate is 6 years and sales now are at their weakest in two decades. According to the most recent data from the Land Registry and ONS, the average price of a property in the UK dipped 0.1% in November from the previous month to £230,630 after declines of 0.4% in October and 0.3% in September.

The leading homebuilders are down an average of 1.50% this morning not really taking too much notice of the data but longer term they are all in downtrends on the weekly charts. One of my favourite shares to chart has always been Barratt Developments (BDEV) as they seem to respect the technicals. As you can see the price is firmly making lower highs and lower lows on the weekly chart. We have entered a period in which prices have pulled back and pushed above 500p. If the upside channel trendline breaks I am happy to say I will review my outlook and we could move higher, but this looks like we may get some kind of rejection at 520-40p and if this confirms maybe a move lower. Nearby at 588p is also the value area, this is the point on the chart where most shares traded hands this could also be an important resistance as the market will let us know if the area is accepted or rejected around it. The volume indicator at the bottom of the chart is sloping down which tells me that the market may not be interested in pushing prices higher but of course, that remains to be seen. 

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.