The UK housing market continues to show signs of improvement as we move into early autumn.
Enhanced mortgage affordability, driven by strong wage growth and declining interest rates, has bolstered confidence among prospective buyers.
The number of mortgages agreed upon has surged over 40% in the past year, reaching its highest level since July 2022, and that is fuelling higher demand for property; good news for estate agents.
Iain McKenzie, CEO of The Guild of Property Professionals, commented: “Estate agents are still reporting healthy levels of footfall coming through the door, with demand for quality housing still high.
“Our members believe that thousands of first-time buyers are still sitting on deposits, waiting for market conditions to improve in their favour.”
Greater demand from buyers is placing upward pressure on property prices.
The latest data from Halifax yesterday shows that UK house prices climbed for the third consecutive month in September, rising by 0.3% or £859, as falling mortgages rates boosted the property market.
According to the mortgage lender, year-on-year, prices have surged by 4.7%, marking the strongest growth rate since November 2022
The typical property price stands at £293,399, slightly up from £292,540 in August, and represents the highest level since June 2022. This left the average price only a little short of the record high of £293,507 set in June 2022, on Halifax’s index, before the market started to slide in autumn 2022 after the mini-budget pushed up mortgage rates.
Anthony Codling, head of European housing and building materials for investment bank RBC Capital Markets, said: “Housing market conditions have steadily improved over the summer and early autumn as wages continue to rise and mortgage rates start to fall. However, the Halifax expects house price growth to remain modest for the rest of the year and in 2025. We are more upbeat than the Halifax, house price growth has a habit of exceeding expectations and is frequently more robust than the experts’ forecasts, and we expect more of the same in the coming months.”
Tom Bill, head of UK residential research, Knight Frank, commented: “The last two years have underlined the close relationship between mortgage rates and house prices – as one goes up the other goes down. We expect low single-digit price growth this year as rates continue to drift lower, with the Budget the main cause of uncertainty on the horizon. If it better than feared, there is likely to be a relief bounce in activity before Christmas that lasts into next spring.”
Also in response to Halifax’s latest House Price Index, Nathan Emerson CEO at Propertymark, added: “It is very welcome news to see yet further growth in the housing market and taking a wide-angle view of the year, there is no doubt consumers are now able to approach the buying and selling process with a far greater degree of confidence compared to the very start of the year.
“There is still further progress to be made, but with strong hints we may see further dips in the base rate before the year is out, we are seeing some lenders already confident enough to switch up their mortgage offerings which is proving very welcome news for borrows.”
Monthly property transactions exceeds 100,000 threshold for the first time in almost two years
