Posts with tag: house prices

Average UK house prices hit £283,000 in May 2022, says government report

Published On: July 20, 2022 at 10:51 am

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SpareRoom study shows most affordable places to rent in the UK

Today’s house price index from the Office for National Statistics (ONS) shows the average UK house price was £283,000 in May 2022. This is £32,000 higher than that time last year.

Highlights from the report also include:

  • UK average house prices increased by 12.8% over the year to May 2022, up from 11.9% in April 2022
  • Average house prices increased over the year in England to £302,000 (13.1%), in Wales to £212,000 (14.4%), in Scotland to £188,000 (11.2%) and in Northern Ireland to £165,000 (10.4%)
  • London continues to be the region with the lowest annual growth at 8.2%

Industry comments on the UK House Price Index: May 2022

Richard Eagling, personal finance expert at NerdWallet, says: “A cooling off period for the property market still seems to be in the offing, and it is always important to note that the ONS house price index tracks a couple of months behind others, so it was unlikely that today’s data would show any slowdown in price growth just yet. 

“Many prospective homebuyers will be watching prices with great interest, deciding when the right time is to act. As with any financial commitment, it is imperative that individuals first evaluate all facets of their financial situation, including their personal savings, credit ratings, outstanding debts, and income. Once this is completed, they can adjust their budget and factor in higher costs – and potentially reassess their home search.

“Additionally, would-be homebuyers must carefully evaluate any mortgage offers, and research the best deals available in terms of rates and loan-to-value options. Making use of online tools such as comparison sites can be helpful here, as it can speed up the process.

“It remains to be seen whether the dual challenge of rising interest rates and inflation will cause house prices to stabilise or deflate a little after a two-year period of remarkable growth. But byers who do their research and preparation now will put themselves in the best position to act when the time is right for them.”

Paresh Raja, CEO of Market Financial Solutions, says: “Political and economic uncertainty invariably fuels speculation that the property market will suffer, but we should be wary of predicting any radical shifts. Rising inflation and interest rates, coupled with political jousting within the Conservative Party, are clearly all factors that will affect the actions of many buyers and sellers across the market. But other factors are at play.

“The perennial undersupply of property plays a critical role in keeping prices high, and this is an issue that will take many, many years to tackle. Moreover, we have seen throughout the pandemic that despite a great deal of uncertainty, house prices have risen. This is because many homebuyers and investors often seek out the security of bricks and mortar as an asset to own – a reflection of the long-term trend of property prices rising and rising.

“That is why we should not be too quick to predict a fall, but instead stay alert to the challenges at hand and focus on make informed, diligent decisions before any property investment.”

Andy Sommerville, Director at Search Acumen, says: “The latest ONS data demonstrates that, despite cost of living pressures acting as a brake on price growth, house prices remain extremely high by historic standards.

“As each month passes, interest rates, inflation, and other cost of living pressures, are intensifying and it is likely that there will be further strain placed on household finances in the upcoming quarters, particularly as inflation is forecast to reach double digits and energy bills are set to rise again in the autumn.

“Nevertheless, while economic turbulence will inevitably and increasingly act to stymie house price growth, prices will continue to stick at peak levels for some time because of an unprecedented set of market dynamics. Post pandemic lifestyle preferences are proving incredibly powerful in driving demand. This, combined with persistent low supply, continues to offset the impact of cost of living on pricing.

“At the same time, while cost of living is having an impact for many first time and lower income buyers, mortgage rates are still low by historic standards, which is allowing many buyers to continue pursuing purchases despite strong pricing and rising household bills.

“While that dynamic is stubbornly holding firm at the moment, interest rates may increase significantly as the Bank of England attempts to combat the fastest pace of inflation for forty years.  As rates go up, this could impact pricing and exclude some buyers from the market.  More immediately though, this reinforces the urgent need for rapid progress in digitising our property sector to drive efficiencies.

“Many buyers are going to be pushing hard to complete purchases as quickly as possible before rates rise further. We need to ensure the sector can cope with high levels of market activity as well as an increased urgency from buyers and sellers to get sales over the line in record time before the cost of their mortgage goes up further.”

Average UK house price rises again, Halifax House Price Index reports

Published On: June 9, 2022 at 8:58 am

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Average UK house price rises again, Halifax House Price Index reports

Yet another record month has been reported for UK house prices, as Halifax sees continued growth.

The latest Halifax House Price Index states that house prices in May 2022 were 10.5% higher than May 2021. However, the monthly increase has slowed to 1.0%.

The average house price has been recorded as £289,099 by Halifax.

Geoff Garrett, Director of Henry Dannell, comments on the report: “A slower rate of house price growth is always likely to follow a reduction in buyer demand and that’s certainly what we’re now seeing following a dip in mortgage approval activity at the start of the year. 

“Buyers are acting with more caution with regard to the sums they are willing to borrow and, at the same time, lenders are reducing their range of products and increasing the rates they are prepared to offer. 

“However, it remains to be seen as to whether this more tentative approach will reverse upward house price trends completely, as insufficient stock remains an issue in the current market.”

Marc von Grundherr, Director of Benham and Reeves, comments: “The fact that the annual rate of growth continues to breach double figures is quite astonishing. 

“Although a slow in the rate of monthly house price growth may indicate an air of lethargy is starting to creep in following such a consistent run of upward growth, the market remains in very fine form.

“With market stock at a scarcity, it looks as though this upward trend is unlikely to subside any time soon, despite ongoing pressure in the form of the escalating cost of living and the threat of a further interest rate increase. 

James Forrester, Managing Director of Barrows and Forrester, comments: “Any mutterings of a property market crash have been greatly exaggerated and the UK property market has remained impervious to the dark clouds that have been gathering over the wider economy in recent months. 

“While many will be struggling with the increased cost of living, the hard task of saving is nothing new for the nation’s aspirational homebuyers who continue to swamp the market while the cost of borrowing remains very favourable.”

Christina Melling, CEO of Stipendium, comments: “It’s certainly a tough time if you’re a first-time buyer. Not only has the initial financial hurdle of buying grown immensely in the last decade, but the gaps between each rung of the property ladder have also become much further apart. 

“As a result, not only is it taking until far later in life to realise our dreams of homeownership, but the climb has become much harder and longer, even once we’ve secured that first foot.”

Government reports continued UK house price growth

Published On: May 18, 2022 at 3:28 pm

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Treasury loses £1.5 billion since hike in rented housing tax

The House Price Index for March 2022 has been published by the Government, revealing the latest house price changes for England, Scotland, Wales, and Northern Ireland.

The report states that the March data shows:

  • On average, house prices have risen 0.3% since February 2022
  • There has been an annual price rise of 9.8%, which makes the average property in the UK valued at £278,436

James Forrester, Managing Director of Barrows and Forrester, comments: “The economy continues to wobble against a backdrop of rising inflation and the cost of living crisis and so the old adage of ‘what goes up must come down’ may certainly be on the minds of many where the UK property market is concerned. 

“So far, this worry is yet to be realised and the market continues to move forward at speed, seemingly impervious to the influence of the wider economic landscape.”

Marc von Grundherr, Director of Benham and Reeves, comments: “The winds of change are certainly starting to blow and while this building economic headwind is yet to derail the phenomenal rates of house price growth being seen across the UK on an annual basis, it certainly seems as though dark clouds are gathering on the horizon with a reduction in pace already materialising on a monthly basis.”

Chris Hodgkinson, Managing Director of HBB Solutions, comments: “The property market remains awash with homebuyers keen to climb the property ladder and with stock levels remaining insufficient, this heightened demand is continuing to drive house prices upwards on an annual basis. 

“However, with interest rates rising and inflation at a 40 year high, mutterings of a looming recession could soon reverse the market conditions seen in recent years and we’re already starting to see a slowdown on a month to month basis. 

“Should this come to fruition, many sellers may find it a struggle to secure a buyer and for a price they are happy with.” 

Rightmove reports ‘best ever spring sellers’ market’ for the UK

Published On: April 26, 2022 at 9:56 am

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Rightmove reports 'best ever spring sellers’ market' for the UK

Rightmove has reported a new record for average house prices, as it sees the ‘best ever spring sellers’ market’.

The average house price in the UK was £354,564 in March 2022.

James Forrester, Managing Director of Barrows and Forrester, comments: “Since early 2020, an unrelenting level of homebuyer demand has fuelled a property market boom that shows no signs of slowing some two years down the line.

“Such sustained market conditions are quite phenomenal and as cliche as it sounds, there really never has been a better time to sell your house. 

“To say homes are selling like hotcakes would be an understatement and with multiple buyers battling it out for every last scrap of property stock, sellers are achieving above and beyond their original price expectations.”

Marc von Grundherr, Director of Benham and Reeves, comments: “As a nation, we’ve endured a prolonged period of economic instability due to the pandemic and yet more dark clouds are gathering due to the cost of living crisis. But despite this the UK property market remains a powerhouse of defiance, demonstrated by the fact that every region of the nation has reached record price highs in unison. 

“Although London continues to trail where this asking price performance is concerned, we’ve already seen concrete signs that the market is starting to turn in 2022, putting a sluggish pandemic performance firmly behind us.

“It will, of course, take some time before this starts to filter through and bolster home seller confidence within the capital, but when it does, it won’t be long before asking price expectations start to climb considerably. So while it very much remains a sellers’ market across the board, now is the time to buy in London as property prices are only heading one way for the remainder of the year, at the very least.” 

Geoff Garrett, Director of Henry Dannell, comments: “There’s no denying that the property market has performed impressively and with the cost of borrowing remaining favourable at present and buyer demand levels unlikely to subside, the short-term outlook remains positive. 

“However, both buyers and sellers would be well advised to make hay while the sun is shining, as growing economic headwinds are likely to take their toll further down the line. 

“While we don’t expect to see market activity evaporate completely, the growing cost of living will be a significant factor in the months to come and as household finances are stretched, it’s likely that prospective buyers will ease off on the sums they’re willing to offer. As a result, sellers will need to realign themselves with these changing market conditions and this will cause the rate of house price growth to cool.”

Chris Hodgkinson, Managing Director of HBB Solutions, comments: “The market is moving at an incredibly fast pace and this certainly favours the nation’s home sellers who are spoilt for choice when it comes to the interest shown in their property. 

“Despite these favourable conditions they are still advised to act with a level head and avoid getting swept up by this cyclone of market activity.

“The highest offer isn’t always the best option and it’s important to consider a buyer’s position within the market, not just the money they’re willing to pay. Failing to do so can see a sale collapse and unnecessary additional costs incurred.” 

Christina Melling, CEO of Stipendium, comments: “What we’re currently seeing is a feeding frenzy from second and third rung buyers and it’s this segment of the market that is driving the unsustainable levels of house price growth seen in recent months.

“Unfortunately, it’s the nation’s first-time buyers who are paying the price and those looking to take that first step are now paying £2,000 more for the pleasure compared to just one month ago. While this may not sound significant to those with the financial foundation of an existing property to fund their onward purchase, it’s yet another brick in an already substantial financial wall that’s blocking many from realising their dreams of homeownership.”

Government releases latest house price data for February 2022

Published On: April 14, 2022 at 8:02 am

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Treasury loses £1.5 billion since hike in rented housing tax

The Government’s UK House Price Index shows that average house prices increased 10.9% in the year to February 2022. The average price of a UK property in February was £276,755.

James Forrester, Managing Director of Barrows and Forrester, comments: “To say we’ve seen a fast start to the year would be somewhat of an understatement where current property market performance is concerned.

“Despite the wider narrative of financial turmoil that is impacting many households, we’ve seen an unrelenting level of homebuyers continue to enter the market in search of what is likely to be the most expensive purchase they will make in their lifetime.

“As a result, we’re seeing homes go under offer at an extremely quick pace, within days of listing them online in many cases, as buyers tussle over what limited stock there is available.”

Chris Hodgkinson, Managing Director of HBB Solutions, comments: “An incredibly competitive market is great for those looking to sell, but for homebuyers entering the fray it can be a stressful and expensive endeavour.

“Not only are they already facing a far higher cost when it comes to climbing the ladder, but pickings are slim in terms of the stock available.

“This not only makes it harder to find their ideal home, but when they do, many are being beaten to the punch, outbid during the offers stage and even gazumped when they think they have finally secured a property.”

Christina Melling, CEO of Stipendium, comments: “The current property market boom is being widely touted as a key indicator of economic success against an otherwise gloomy pandemic backdrop. But while those lucky enough to already own a home may agree, it’s unlikely this sentiment is shared by those struggling to get a foot on the ladder.

“The average first-time buyer is now over £21,000 worse off than just a year ago having seen the value of a first home increase by 10.1%.

“While the cost of borrowing may remain favourable, the initial financial hurdle of a mortgage deposit is simply too much for many to overcome. With the cost of living also climbing, those previously struggling to save will no doubt find the task almost impossible going forward.”

Lee Martin, Head of UK for new-build specialists Unlatch, comments: “Demand for new homes has only grown stronger in 2022 and the sector is certainly playing a pivotal role where market performance is concerned. This is evident by the fact that new-build house prices are climbing at more than double the rate of the existing market and so it’s fair to say the sector is the engine room driving current rates of house price appreciation.

“But despite this strong performance, it’s also fair to say that the sector is helping beleaguered first-time buyers by enabling them to reduce the sizeable financial barrier of a mortgage deposit by utilising the Help to Buy scheme.

“So while the Government has largely failed in its ambitions to build more homes, the nation’s housebuilders have taken up the mantle to keep Britain building, delivering housing stock that is sorely needed at all levels of the market.”

Geoff Garrett, Director of Henry Dannell, comments: “The market has continued to excel despite what is a very delicate economic landscape and while the cost of borrowing has remained fairly favourable, those currently looking to buy should tread very cautiously with regard to over borrowing.

“It remains to be seen as to whether the cost of a mortgage will climb substantially this year, but with the wider cost of living also putting a squeeze on household finances, those borrowing well beyond their means may fall into financial difficulty further down the line.”

Jonathan Samuels, CEO of Octane Capital, comments: “Mortgage rates have already climbed by one percent so far this year and they are only going to go in one direction.

“So while many homebuyers may find that the cost of borrowing remains fairly affordable at present, they can expect this cost to increase over the coming months.

“While this won’t stall the market completely, it will certainly dampen market activity and it’s only a matter of time before this impacts house prices.”

Marc von Grundherr, Director of Benham and Reeves, comments: “While the London market continues to trail the house price pack where annual rates of appreciation are concerned, February’s explosive monthly increase provides the first signs of how quickly the tide is starting to turn.

“We’ve seen a sharp uptick in market activity on the ground for some months, driven by the return of both domestic professionals and foreign buyers, and this is now starting to translate into positive market momentum.

“Although the wider UK market may be susceptible to higher mortgage rates and the increasing cost of living, this is less likely to faze buyers within the capital. So we expect to see a complete role reversal with regard to property value performance as the year goes on.”

Average UK house prices at another record high, Halifax data shows

Published On: April 8, 2022 at 9:24 am

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Average UK house price rises again, Halifax House Price Index reports

The latest Halifax House Price Index reports a monthly house price growth of 1.4% in March, the biggest increase in six months. 

Average house prices in the UK are now at another record high of £282,753. Read the full report here.

James Forrester, Managing Director of Barrows and Forrester, comments: “An unwavering level of market activity has continued to drive house price appreciation in 2022 and this further growth comes off the back of a pandemic property market boom that had already pushed property prices to record highs. 

“Buyer demand remains extremely high and with a lack of stock to meet this demand, there’s no end in sight when it comes to the current state of the market. Even fears around the increasing cost of living and a number of interest rate increases are yet to make a dent and so the outlook for the year ahead is a positive one where market values are concerned.”

Marc von Grundherr, Director of Benham and Reeves, comments: “A monthly look at house price growth is far too volatile a metric to judge wider market health upon. However, yet another double-digit annual increase is the real proof in the pudding and demonstrates a market that is flying high, even when compared to the strong performance posted this time last year. 

“The returning health of the London market has no doubt contributed to this. While the wider UK market was more than holding its own during much of the pandemic, this strong performance is now being bolstered by growing momentum across what is traditionally the powerhouse of UK property.  

“A return to the workplace and an influx of foreign demand are starting to stimulate property values across the capital and this will ensure that top line house price growth remains robust for the remainder of this year.”

Geoff Garrett, Director of Henry Dannell, comments: “Despite a string of interest rate increases and the inevitable impact this has had on monthly mortgage costs, the nation’s homebuyers are seemingly undeterred and continue to flood the market at mass.

“However, the general consensus is that this squeeze on mortgage affordability coupled with the increase in living costs will start to cool the current rate of house price growth as the year goes on. 

“While this may not be substantial enough to reverse the upward house price trends being seen at present, it’s almost certainly going to slow what have been some meteoric rises in recent months.”