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Industry experts react to Nationwide House Price Index

by | Apr 2, 2024

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Following Nationwide’s HPI for March that showed UK house prices up 1.6% compared with a year ago, industry experts have shared their thoughts with IFA Magazine.

Yasin Patel, co-founder of ethical property investors Autarky Sukuk, said: “Despite a modest month-on-month fall of 0.2%, we envisage this will change as we enter the busier months of spring and summer as demand increases. Homeowners should be reassured that their property assets are regaining value that was lost last year.

“With this in mind, investors can anticipate a positive trajectory throughout the year. As the rental market continues to boom, there is a high chance of healthy returns for buy-to-let investments too.

 
 

“Our research consistently finds that there are stark differences in house price growth across the country, so it pays to do due diligence in your research beforehand. Buyers need to stay attuned to local market dynamics before dipping their toes into the world of property investment.

“The unexpected monthly fall revealed in these figures will grab people’s attention, but we can still say with some degree of confidence that the outlook is positive.”

Kate Steere, housing expert at personal finance comparison site finder.com said: “Today’s figures show that we’re not out of the woods yet. Lenders have cut mortgage rates and wage growth has outstripped inflation, but buyers are still concerned about affordability issues and demand has been dampened as a result. The Bank of England’s decision to hold rates has tempered house price recovery. Meanwhile, half of experts believe that the Bank will wait until June 2024 before cutting rates, meaning we’re likely to see only a subdued recovery in house prices in the next couple of months.” 

 

Jonathan Hopper, CEO of Garrington Property Finders, comments: “We’re in recovery, not runaway, territory – and this may be no bad thing.

“Two things are clear from the Nationwide’s latest snapshot of the UK’s property market. The surge in price rises seen at the start of the year is easing off, and big regional disparities remain.

“While buyer confidence is back, and the widespread price falls of last year are firmly in the rear-view mirror, price rises are still being tempered by the high cost of borrowing.

“The mortgage market alternated between being an accelerator and a brake for the property market during the first quarter of 2024.

“The flurry of interest rate cuts seen in January fired the starting gun, tempting back to the table thousands of would-be buyers and movers who held off in 2023.  But in recent weeks, many lenders have paused their rate reductions, and this is now keeping property price rises in check.

“As a result, the fastest price growth is being seeing in areas where affordability is better. Average prices in Northern England jumped by 4.1% in the first quarter of 2024 compared to the same period last year. Across England as a whole, prices were up just 0.4% over the same timeframe.

“While we may have to wait until the Bank of England’s next Base Rate decision in May before interest rates start to fall significantly, the property market is returning to health gradually and we’re seeing increasing numbers of buyers decide that now is the time to strike, while also being very price sensitive.

“There’s a will to move for many, the challenge is finding a way. As a result prices are likely to meander in coming months.”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, said: “The property market is moving in a positive direction, with strong annual price growth.

“Demand is ramping up, with buyers feeling much more positive thanks to the heightened competition between mortgage lenders pulling borrowing rates down. 

“This is making budgeting much easier, and easing some of the affordability pressures we have seen over the past year. Expectations that the Bank of England could soon commit to lowering the base rate is also driving more demand. 

“Sellers still need to price sensibly to attract attention, as buyers know they are in a strong negotiating position. But reasonably-priced properties in desirable locations are still being snapped up quickly, and this is a factor behind some of the price growth we are seeing at the moment.” 

Foxtons CEO, Guy Gittins, says: “The UK property market has well and truly sprung into action in recent months and we’ve seen a notable uplift in the volume of sales enquiries, viewings requests and the number of offers being submitted. It’s fair to say that the green shoots of positivity seen since the closing stages of last year are blossoming and this is helping to cultivate positive house price growth. 

“Higher mortgage rates do remain a concern for many buyers and will continue to influence the price they are able to pay to a degree. However, with interest rates expected to fall this year, market confidence is high and we’re continuing to see buyers move forward with their plans to purchase undeterred.”

Lomond CEO, Ed Phillips, commented:  “Slowly but surely, the UK property market is responding to the overarching air of stability that has developed since interest rates have been held at 5.25%. 

“While we’re yet to see any notable jump in property values just yet, market momentum is building, with a firm foundation now laid to facilitate further growth as we head into what is traditionally the busiest time of year.”

Nathan Emerson, CEO of Propertymark, comments: “Sellers have every reason to start feeling positive about putting their home up for sale and being able to go on to buy their next perfect property. 2024 has shown a positive trend that house prices are growing once again following three years of economic turbulence. 

“However the UK Government must look to make houses equally affordable for buyers and that can only be done by building more houses. Propertymark’s own Housing Insight Report found there has been an 80 per cent increase in the number of new properties becoming available, ultimately making it easier for people to consider a move.” 

Director of Benham and Reeves, Marc von Grundherr, commented: “As we approach the spring selling season a very marginal decline in the monthly rate of house price growth should be viewed as nothing more than the market pausing for breath before the floodgates open. 

“The real measure of market health is the annual rate of growth and a 1.6% jump demonstrates that we are very much heading in the right direction and it’s full steam ahead for the remainder of the year.”

CEO of Open Property Group , Jason Harris-Cohen, commented: “The market has continued to tiptoe forward in 2024 as buyers look to make their move. 

“However, while the outlook is positive for the year ahead, sellers will need to remain patient. Not only will the higher cost of borrowing continue to prove problematic, but an uplift in market activity is also likely to increase fall through frequencies, while also delaying the time it’s taking to sell.”

CEO of Yopa, Verona Frankish, commented: “The appetite of the nation’s homebuyers may have been dampened by higher mortgage rates, but it certainly hasn’t disappeared, as demonstrated by the improvements seen in mortgaged approved house prices seen in recent months.

“With the seasonal spring surge in market activity also imminent, it’s only a matter of time before we see the UK property market shift up a gear with respect to both sales volumes and house price growth.”

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