Halifax’s latest HPI data has revealed that property prices have dropped by -1.0% on an annual basis in the month of November.
In response to the latest update, mortgage and property experts have shared their thoughts with IFA Magazine.
Nicky Stevenson, Managing Director at national estate agent group Fine & Country said: “House prices grew in the final months of the year, continuing to defy the predictions forecasting falls. Despite the year’s economic challenges, the property market has proved to be incredibly resilient.
“Wage growth and robust employment levels continue to bolster market stability and with the economic outlook improving, there is reason to be optimistic about 2024.
“Buyers are returning to the market as interest rates stabilise, and a high proportion of them are highly motivated to move.
“This has led to an increase in sales compared to the same period last year, indicating growing confidence among buyers, but also showing that sellers are becoming more realistic about pricing and accepting lower offers.
“As inflation falls and confidence growths further, we anticipate further positive momentum in the coming year.”
Tom Brown, Managing Director, Real Estate at Ingenious, said: “The UK property sector continues to demonstrate its resilience and popularity in the face of high inflation and higher borrowing rates. Nationally, there remains a significant shortage of housing inventory across most locations and price points. Consequently, any slow-down in sales volumes from homeowners is likely to be offset by increased demand from renters and investors.
“However, it’s essential to note that the situation is not uniform throughout the country and across all price ranges. When analysing opportunities, it is key to understand the underlying subsectors and regional dynamics. Taking too broad a view of the market can be misleading. For instance, the institutional housing sector has experienced fewer disruptions compared to the residential sector due to its long-term investment horizon, rental growth and substantial capital inflows.
“The New Year will bring with it a new and exciting set of challenges and opportunities for growth and progression in what we do. We are looking forward to continuing to work with borrowers and investors and delivering for them. The dynamic landscape of the markets that we serve, and the wider economy requires us to evolve to stay relevant in addressing diverse challenges including the climate crisis, and changes in the way we are all living. 2024 will see Ingenious broaden the reach of our widely embraced development lending product. This expansion aims to offer extended terms for stabilisation to specialised developers within the rental sectors. Additionally, special lending terms will be introduced for developers with a specific focus on minimising embedded carbon in their construction practices.”
Jonathan Hopper, CEO of Garrington Property Finders, comments: “As winter temperatures begin to bite across much of the UK, parts of the property market are starting to thaw.
“The Halifax data looks almost spring-like, with its calculation that the value of the average UK home has crept back to just 1% below where it was a year ago.
“But these national averages can be very misleading, and several regional markets remain stuck in the deep freeze. With a gap of 6.1% between the best and worst performing areas, the great reset is not over yet.
“In the main, it’s the affordable end of the market which is showing the most resilience. Britain’s prime postcodes remain out of reach for their traditional buyers, and as a result locations like London have seen significant price falls this year.
“It’s worth remembering too that localised upticks in prices are more likely to be due to a shortage of stock rather than any meaningful rise in demand. Government data shows that the number of homes sold in October was down a fifth compared to the same month last year.
“Buyers remain firmly in the driving seat, with many using their strong bargaining position to demand – and get – significant discounts off asking prices. We’re still seeing double-digit price reductions in some areas.
“However sentiment is improving and previously hesitant buyers are coming off the fence, encouraged by the decision of some mortgage lenders to trim their interest rates as expectations grow that the Bank of England Base Rate has peaked.
“Widespread falls in price mean that homes in many areas are better value than they were a year ago. This, combined with cheaper borrowing costs, should make the market more predictable and balanced in the New Year, and provide greater clarity for movers to base their plans upon.”
Foxtons CEO, Guy Gittins, commented: “A second consecutive monthly increase demonstrates further signs of property market positivity today.
“Although the market is yet to return to full health when viewing house price performance on an annual basis, it appears as though a freeze in interest rates is helping to boost homebuyer sentiment and bring a greater degree of stability. This puts us in very good stead looking ahead to the new year”
CEO of Yopa, Verona Frankish, commented: “It appears as though cooling market conditions have now started to thaw, with multiple house price indices showing that the market is now heading in the right direction, as house prices continue to climb on a monthly basis.
“A hold on interest rates has brought greater stability for buyers who are already returning to the market despite the usual Christmas break fast approaching and we’ve already seen seller numbers increase notably in recent weeks.
“This suggests that both parties are keen to hit the ground running in the new year and this boost to market sentiment will help to further improve market health.”
Director of Benham and Reeves, Marc von Grundherr, commented: “Despite a turbulent year, we look set to finish pretty much where we started with respect to house price performance and this is certainly no bad thing given that property values boomed during the pandemic.
“While this may seem a tad underwhelming for the nation’s home sellers, they can enter the market with the confidence that their home will continue to command a very strong price indeed and we’ve already seen many make the decision to do so in recent weeks.”
CEO of Octane Capital, Jonathan Samuels, commented: “While buyers remain somewhat restricted due to higher mortgage rates, we have seen an uptick in the number of mortgage approvals in recent months which suggests that a static base rate is helping to boost market confidence.
“So while house prices may have remained largely unchanged and are expected to do so until the end of the year, this does, at least, provide a strong foundation for positive market growth in the new year.”
Nathan Emerson CEO at Propertymark comments: “There is little hiding away from the fact 2023 has been a complex and challenging year for the housing market. The market has grappled with both high inflation and elevated interest rates and this unfavourable combination has brought a far more cautious approach from both buyers and sellers alike.
“Propertymark remain optimistic 2024 will bring a more positive outlook, with inflation hopefully continuing to drop and household earnings gathering greater momentum. However, we must remain vigilant, as recovery sometimes comes with unexpected challenges along the way.
“It’s important to realise that while some geographical areas are starting to gain traction once again, for an overall healthy property market it would be preferable to see this universally across the entire UK before we can be confidently reassured.”
