Following the latest Nationwide HPI data that revealed that UK house prices rose 0.1% month on month in October, industry experts have shared their thought on the current state of the market.
Iain McKenzie, CEO of The Guild of Property Professionals, comments: “As we come into the closing months of the year, we’re increasingly seeing the telltale signs of a market in recovery. House prices, property sales and mortgage approvals are all showing resilience and stability in the face of continued cost-of-living challenges.
“While the pace of house price growth has slowed, there was a marginal increase in October, which should still come as welcome news to the industry. It is also another reminder that the frenzy of activity that we saw during the pandemic era is now a distant memory.
“The annual rate of growth may begin to slow in the coming months, as we will be comparing to a time when the market was recovering from the disastrous ‘mini budget’ of 2022.
“Mortgage approvals are up to pre-pandemic levels which is very encouraging news and will be welcomed by estate agents and their clients. Buyers are still finding suitable mortgages despite the prevailing high interest rates.
“While sellers would no doubt like to see house prices climb faster, they need to remain realistic on asking prices. Buyers will still be looking to haggle for a bargain, especially if they have struggled to save for a deposit in recent times.
“There are healthy levels of housing stock on the market, so sellers should expect some competition. If you’re selling a property, work with your estate agent to set a price that allows for some wriggle room.”
Nicky Stevenson, Managing Director at national estate agent group Fine & Country, said: “House prices held steady in October, and early reaction to the Budget seems optimistic that the Chancellor’s changes will not disrupt the market’s growth.
“There has been a notable resurgence in confidence among buyers, driven by positive economic indicators that have bolstered the market throughout the year. The favourable backdrop of lower interest rates and stabilising inflation has encouraged many to view the property market as a stable investment. It will take some time to see the full effect of the Autumn budget announced by Labour this week.
“The wealthy and multiple-home owners will be the hardest hit by these tax raises. In particular, the recent 5% stamp duty surcharge has added an extra layer of consideration for second-home buyers. But in the days following the announcement, we have observed that most of the clients in our network have chosen to move forward with their purchases. This demonstrates the continued strength and resilience of the property market, even in the face of additional costs. Buyers remain motivated to complete transactions, which shows confidence in the value of their investments.
“Interestingly, we’ve seen cases where the new surcharge has encouraged buyers to reconsider their property portfolios. In one instance, a buyer opted to sell their primary residence to reclaim the surcharge, signalling a flexible approach to navigating these new costs. Looking ahead, there is potential for another base rate cut from the Bank of England this month, which could help alleviate any setbacks resulting from the budget and contribute to a strong finish for 2024.”
Myles Moloney, Area Sales Manager at Chase Buchanan, says: “At the beginning of October we saw continued buyer confidence which was boosted by favourable mortgage rates and a greater number of properties being put up for sale. As we were nearing the Autumn Budget, however, house hunters and sellers grew more cautious.”
Nathan Emerson, CEO of Propertymark, comments: “As the wider economy has become more settled, it’s encouraging to witness greater affordability and confidence flow through the housing market. With strong hints we may see a steady reduction in base rates implemented over the coming months, there is substantial scope to round the year with an upbeat tone to be carried forward into 2025.
“However, it is important to acknowledge the potential impact the budget may have on first time buyers from next April onwards, as the current stamp duty threshold is lowered back to £300,000. In real terms, this could mean an additional tax expenditure of £6,250 for those hoping to start their property journey with a house priced at £425,000.”
Daniel Austin, CEO and co-founder at ASK Partners, said: “We are continuing to see a year-on-year rise in house prices and the market appears to be showing signs of continued resilience. Following this week’s Budget, the market is likely to feel buoyant with £5bn promised for new homes and the government’s permanent establishment of the mortgage guarantee scheme, which supports lenders offering 95% loan-to-value mortgages. Increased supply should continue to support the market and level out values; a plus for first time buyers, who conversely will be hit by the new lower stamp duty thresholds.
“In the property investment world, rent values have seen sustained growth, positioning real estate as reasonably valued in comparison to gilts and presenting growth potential. Incentives announced in the budget to support the Build-to-Rent sector, including £3bn in housing guarantee schemes that provide lower-cost loans should entice developers. While private investors will be hit by the Higher Rate for Additional Dwellings, SME housebuilders will benefit from the Affordable Homes Programme and funding to unlock stalled developments, all contributing to increased supply.
“Sustained house price growth, lower interest rates and dampened inflation alongside new initiatives to benefit developers, should continue to stimulate market growth. As a debt provider we will be pleased to see more favourable market conditions unlocking strong assets in good locations for well-capitalised borrowers.”
