Housing market on the move again

The short hiatus caused by the election is now over and the various indices are reporting house prices are growing once more and a clear trend is emerging.

Nationwide’s data shows the average price rose by 0.3% in July, with the annual rate of growth going from 1.5% to 2.1% in July, which is its fastest pace since December 2022.

Halifax had month-on-month growth of 0.8%. Their annual growth was the highest since the start of the year at 2.3%.

The cut in the Bank of England’s base rate came too late for it to have any discernible effect on any of the indices’ current figures.

Both Halifax and Nationwide though have since cautioned that despite the cut, borrowing costs remain high and house price growth will continue to be subdued while affordability constraints remain.

Amanda Bryden, Head of Mortgages, Halifax, said:

“Last week’s Bank of England’s Base Rate cut, which follows recent reductions in mortgage rates, is encouraging for those looking to remortgage, purchase a first home or move along the housing ladder. However, affordability constraints and the lack of available properties continue to pose challenges for prospective homeowners.”

And Robert Gardner, Nationwide's Chief Economist, said:

“Investors expect Bank Rate to be lowered modestly in the years ahead, which, if correct, will help to bring down borrowing costs. However, the impact is likely to be fairly modest as the swap rates which underpin fixed-rate mortgage pricing already embody expectations that interest rates will decline in the years ahead.”

Rightmove’s index was the only one to report a fall (-0.4%), although their index is based on asking prices which normally fall over the quieter summer months as sellers chase fewer buyers. The price data then won’t appear in the other indexes for several months until those properties are actually sold.

HOUSE PRICES AND STATISTICS

There were steady rises in July and annual growth is slowly creeping up.

Nationwide: July: Avge. price £266,334. Monthly change +0.3%. Annual change +2.1%
Halifax: July: Avge. price £291,268. Monthly change +0.8%. Annual change +2.3%
Land Registry: May: Avge. price £285,201. Monthly change +1.2%. Annual change +2.2%
Zoopla: June: Avge. price £265,600 . Annual change 0.1%
Rightmove: July: Avge. price £373,493. Monthly change -0.4%. Annual change +0.4% (asking prices on Rightmove)

BUY-TO-LET

Although rents continue to rise, there has been a sharp slowdown in London. The average was up by 0.7% to £1308 in July, which is an annual rise of 5.2%. In London, falls that

started in late spring are continuing. The Capital’s rents were down by 0.1% to £2,101 and annually they were down by 0.4%.

The falls though were far more pronounced in central areas, such as Westminster (-4.8%), Tower Hamlets (6.7%) and Wandsworth (-11.2%). In contrast, in Bromley, rents were up 6.4% and by 10.5% in Redbridge and Waltham Forest.

In other news, the looming Renter’s Reform Bill has led to a lot of speculation in the media that there could be a mass exodus of landlords. A recent report from RICS, however, shows although instructions to their members from Landlords had fallen, the reduction was more of a trickle than a torrent and nowhere near the numbers seen 12 months previously.

If you are thinking about investing in the housing market, why not take a look at some of the fabulous properties we have coming up in our next auction at Phillip Arnold Auctions.

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