Land Registry HPI: “Curiously, activity may even ramp up again now that everyone knows what’s happening with their utility bills” – reaction from property experts

by | Sep 14, 2022

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Following the Land Registry July HPI published this morning, property experts have reacted.

Andrew Montlake, managing director of the UK-wide mortgage broker, Coreco: “The July data has been skewed by the Stamp Duty holiday so needs to be taken with a pinch of salt. The reality is that the property market has been slowly cooling in recent months as the nation is gripped by an unprecedented cost of living crisis. We’re also seeing valuers start to get more conservative due to the strong economic headwinds. With more rate rises a nailed-on certainty and the cost-of-living crisis set to worsen as we enter the winter, the property market will likely see modest price growth between now and the Spring. Higher mortgage rates and the immense pressure on household finances are also likely to result in demand dropping off in the months ahead. As ever, though, the lack of supply will support prices and prevent a pronounced fall.”

Imran Hussain, director at Nottingham-based Harmony Financial Services: “Anyone hoping for a massive drop in prices and to snap up a bargain will be in for a shock. Though activity levels have calmed down slightly, demand is still there. Curiously, activity may even ramp up again now that everyone knows what’s happening with their utility bills for the next two years. The rate of property price growth will likely level off in certain regions of the country but areas that are in high demand will always command a premium. And even though mortgage rates are rising, in many cases it’s still cheaper to own than to rent.”

Ross Boyd, founder of the always-on mortgage comparison platform, “England won the Rugby World Cup the last time annual price growth was this high but clearly the numbers have to be put into context and viewed against the backdrop of changes to the Stamp Duty regime. The property market is going to be put under growing pressure in the months ahead, but we’re still unlikely to see prices fall due to the lack of homes on the market and shortage of properties being built. Expect modest or negligible price growth in the short-term rather than a market collapse.” 


Edgar Rayo, chief economist at London-based finance broker, Finanze“The housing market is already being battered by supply chain issues that have fuelled the increase in construction prices, while build-cost inflation continues to squeeze developers’ margins. Adding to the distress is the fourth consecutive monthly drop in new buyer enquiries, according to The Royal Institution of Chartered Surveyors’ (RICS) survey results released last week. With global property downturns growing, UK real estate builders have yet to see a rise in consumer confidence equal to pre-pandemic levels given the painful cost of living that is hammering households’ finances, as well as the withdrawal of the Help to Buy equity loan scheme by the government. They will have to contend with higher borrowing costs in the coming years as surging inflation will drive the Bank of England to further raise interest rates before the year ends. Further interest rate hikes by Threadneedle Street will eventually slow down the surging growth in housing prices. This means that those who are planning to purchase their homes must swiftly act now in anticipation of higher interest rates in the coming months.”

Mark Robinson, Managing Director of Southampton-based Albion Forest Mortgages“Even as we enter a very dark winter for the economy, I cannot see house prices falling due to the sheer lack of supply. We are, however, far more likely to see a slower rate of house price growth. Though there is slightly less competition than a year ago as some prospective buyers put their plans on hold amid the cost of living crisis, it’s still a sellers’ market.”

Samuel Mather-Holgate of Swindon-based advisory firm, Mather & Murray Financial: “Property transactions are definitely slowing down and may well fall off a cliff over the coming months. Not only is autumn and winter a slower period, but the economy is giving people the jitters. Nervous people sit tight, they don’t entertain what is often the biggest financial transaction of their lives. However, despite the economic situation, I don’t expect a material reduction in prices as homeowners will want to recoup what they have spent on their homes during and after lockdown so are unlikely to sell at a discount. We are more likely to see house prices flatline.”


Dominik Lipnicki, director of Your Mortgage Decisions“Even though the latest inflation data published Wednesday showed a slight drop-off, it’s still extremely high and most predict it will rise even further in the months ahead. Together with higher mortgage rates, the cost of living crisis will without doubt have an effect on house prices. Few expect a significant fall but a a very slight increase in the rate of price growth over the next 12 months is a likely scenario.”

James Miles, director of Exeter-based broker, The Mortgage Quarter: “There’s no doubt we will see a slowdown in the market as the cost of living crisis hits buyers in the pocket where it hurts. With supply still so low, I do not expect prices to reduce but rather for price growth to level out. The property market certainly needs a stable period because prices have become silly since the Stamp Duty holiday, with monster growth over the past couple of years.”

Ross McMillan, owner at Glasgow-based Blue Fish Mortgage Solutions: “Though the property market remains in a relatively healthy state for now, there’s nowhere near the frenzied activity that has defined the market during the past couple of years. We’re typically now seeing just two or three buyers competing for a property rather than two dozen, as was the case this time last year. In some instances, some old-fashioned negotiation between a single buyer and seller is now making a comeback. While there is still a general lack of supply, sellers’ expectations are also becoming more reasonable and generally more in line with valuations. The current flattening in the market and greater equilibrium between buyers and sellers is a good thing and in the past month I have had several clients make successful offers after some had been looking and offering unsuccessfully for over two years. Unlike the Global Financial Crisis of 2007/08, arguably the most important element of the housing market is that it remains fluid and functional so while prices may stagnate or fall slightly due to the cost of living crisis, I am confident that demand will remain and transactions will continue, albeit at lower levels than the past two years.”


Mike Staton, director of Mansfield-based Staton Mortgages: “I think we will see house prices increase further as there is still demand out there, although there will not be 10 to 15 people going for the same property as there have been during the past two years or so. However, there are still enough buyers to keep it a sellers’ market in my opinion. Only too often I see estate agents try to justify marketing valuations based on Rightmove or Zoopla data, which simply isn’t accurate. Last week we had a client’s purchase downvalued by £30,000 only for the estate agent in question to show us marketing prices for comparables and not completed prices.”

Lewis Shaw, founder of Mansfield-based Shaw Financial Services: “First-time buyers have been leading the way in recent months. The volume of enquiries and calls we’re getting remain at record levels, which is starting to feel a bit odd given the cost of living crisis and rising interest rates. It should be getting quieter, yet we’re seeing the opposite. With two years of breakneck house price growth, it’s as though the property market has uncoupled from the economic train and is now freewheeling down the tracks without any brakes. Let’s hope for a gradual slowdown rather than crashing into the barriers. The fact that we’re now seeing loans for prime borrowers nudge over 5% may well start to see demand fall slightly and result in a cooldown rather than a crash.” 

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