Tag: House prices

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UK house prices closing in on new high according to Halifax

UK House Prices

Last month, the average UK house price nearly reached a record high, buoyed by decreasing mortgage rates that have lifted buyer confidence, Halifax reports.

Halifax, the UK’s largest mortgage lender, noted that the average house price climbed to £293,399 in September 2024, narrowly missing the record of £293,507 set in June 2022.

According to Halifax, house prices have been on an upward trend for three consecutive months as market conditions have improved.

Easier mortgage affordability, driven by robust wage increases and declining interest rates, has enhanced confidence among buyers, leading to a rise in the number of mortgages agreed upon over the past year.

Halifax has recorded a 4.7% increase in house prices compared to the previous year, marking the most rapid growth rate since November 2022.

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UK house prices experience biggest rise in over a year

UK house prices up

House prices had the biggest monthly rise in October for more than a year, according to the Nationwide Building Society.

However, they were still down sharply on a year ago, the UK’s biggest building society noted. The rise in prices was most likely due to there not being enough properties to meet demand.

However, activity in the housing market is still extremely slow, as buyers struggle with higher mortgage rates.

Interest rates, which underpin mortgage pricing, have moderated recently but they are still well above the lows of 2021. The Bank of England has raised interest rates from lows of around 0.1% to 5.25% in its inflation battle.

UK inflation is over 6.5% – the target is 2%.

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UK house prices experience biggest yearly decline since 2009

UK House Prices Fall

The Nationwide Building Society says house prices are 5.3% lower compared to August last year, in the biggest annual decline since 2009.

Nationwide said the drop represented a fall of £14,600 on a typical home in the UK since house prices peaked in August 2022. It also said higher borrowing costs for buyers had led to a slowdown in activity in the housing market. Mortgage approvals are also about 20% below pre-Covid levels.

After 14 rate increases from the Bank of England – a two year fixed rate mortgage is now touching 6.7%

Since December 2021, the Bank of England (BoE) has raised interest rates 14 times in row in a bid to clamp down on rising inflation in the UK. The bank’s base rate now stands at 5.25%. This has led to lenders raising their mortgage rates, putting increased pressure on homebuyers.

The average two-year fixed mortgage rate on Friday was 6.7%, while the average five-year fix was 6.19%.

Average house prices in the UK peaked at £273,751 in August 2022 but fell to £259,153 last month.

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UK house prices fall according to the Nationwide Building Society

UK House Price Drop

UK house prices dropped at their fastest annual pace for 14 years in July 2023, according to Nationwide.

The building society said house prices dropped by 3.8%, which is the biggest decline since July 2009. Nationwide said mortgage interest rates remain high, making affordability a difficult for house-buyers. Mortgage costs hit the highest level for 15 years in July 2023 as lenders grappled with inflation and uncertainty over rates set by the (BoE) Bank of England. The BoE recently raised interest rates by 0.5% to 5% in a belated efforet to curb rampant inflation which is currently well above the 2% target.

Average UK house £260,828

The average price of a home in the UK is £260,828 – 4.5% below the August 2022 peak. Many first-time buyers would welcome a drop in house prices, which have climbed in recent years, including during the pandemic.

But despite July’s fall, higher mortgage rates mean housing affordability ‘remains stretched‘, Nationwide said.

Real average house price data from 1975 – 2022*

*Indicative guide only (prices adjusted for inflation).