Late summer bounce

With the election over and the base rate looking like it is finally on the way down, there has been a bit of a bounce in the housing market this August and that was despite it being peak holiday season.

Rightmove is reporting that the number of potential buyers enquiring with agents about homes for sale has jumped by 19% when compared to August last year. And that’s up from 11% in July.

Lender Nationwide is reporting that house price rises have now reached 2.4% on an annual basis, which is the fastest pace since December 2022.

And Halifax says house prices increased by 0.3% in August, after a 0.9% rise in July.

Tim Bannister Rightmove’s Director of Property Science says:

“The first Bank Rate cut since 2020 has sparked a welcome late summer boost in buyer activity. While mortgage rates aren’t yet substantially lower since the rate cut, the fact that the long-hoped-for first cut has finally arrived, and mortgage rates are heading downwards, is positive for home-mover sentiment.

“As the summer holiday season comes to an end, the conditions are there for a more active autumn market.”

And Robert Gardner, Nationwide's Chief Economist, says of the road ahead:

“Providing the economy continues to recover steadily, as we expect, housing market activity is likely to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth.”

There is though the looming spectre of Rachel Reeves' much-publicised autumn budget and Keir Starmer’s warning of ‘pain to come’. It remains to be seen exactly what it will mean for the property market but in the meantime, it may at least give some movers pause for thought.

HOUSE PRICES AND STATISTICS

July's rises have continued into August, despite concerns over the upcoming budget.

Nationwide: Aug: Avge. price £265,375. Monthly change -0.2%. Annual change +2.4%
Halifax: Aug. Avge. price £292,505. Monthly change +0.3%. Annual change +4.3%
Land Registry: June: Avge. price £287,924. Monthly change +0.5%. Annual change +2.7%
Zoopla: July: Avge. price £266,400. Annual change 0.5%
Rightmove: Aug: Avge. price £367,785. Monthly change -1.5%. Annual change +0.8% (asking prices on Rightmove)

BUY-TO-LET

With the Renters' Right Bill now making its way through parliament, the prospect of the ending of no-fault evictions and higher Capital Gains Tax is leading to significant numbers of landlords leaving the market.

According to analysis by data firm TwentyCi, the number of ex-rental properties for sale in central London has hit a 10-year high as landlords flee Labour’s threatened crackdown.

However, if as expected, CGT is aligned with landlords’ income tax rates, it may soon become more cost-effective for them to stay put.

In addition, the shortfall in rental property is likely to push up rents even further. Homelet’s rental index shows the average rent was up again last month by 1.3% to £1,325. That’s a rise of 5.1% on an annual basis.

After 3 months of falls, the biggest rise though was in London, where rents jumped by 2.2% in August. The average London rent is now £2,148 with annual growth currently running at just 0.1%.

If you want to take advantage of the bounce, 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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