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UK house prices rise to record highs for fifth month in a row

House prices in the UK have hit record highs for a fifth month in a row.

Across the country, the average asking price in June stands at £368,614, Rightmove said.

Prices edged up by 0.3% or £1,113 on average month-on-month as the pace of price growth is slowing, the property website said.

Despite a string of interest rate rises and the increasing cost of living, buyer demand for available properties remains very strong, it said.

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But it added that following a very strong first half of the year, it is likely that affordability constraints will have a greater influence on market behaviour in the months ahead.

This, alongside more choice coming onto the market for buyers and the usual seasonal variations, means there are likely to be some month-on-month price falls during the second half of the year, Rightmove predicts.

Tim Bannister, Rightmove’s director of property science, said: “Entering the second half of the year, we anticipate some further slowdown in the pace of price rises, particularly given the worsening affordability challenges that people are facing.

“We expect this to bring the annual rate of price growth down from the current 9.7% towards the 5% increase that Rightmove predicted at the beginning of the year.”

Rightmove said it currently takes around 150 days to complete a purchase on average after agreeing a sale – 50 days longer than at this time in 2019.

There are more than 500,000 homes that are currently sold subject to contract it added, which is 44% higher than it was at this time in 2019 and 39% higher than the pre-pandemic five-year average.

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Rightmove’s report was released as the EY ITEM Club said it expects UK house prices to rise 8% over the course of 2022, followed by a growth of 1.8% in 2023 and 1.2% in 2024.

Peter Arnold, EY UK chief economist, said: “In previous economic cycles, a house price contraction would be on the cards with incomes squeezed and a high chance of a market correction after two years of out-sized growth. Instead, house prices are set for a softer landing.”

Nitesh Patel, economist at Yorkshire Building Society, said: “Demand for housing has far outstripped supply for years, but it’s not just the quantity of houses we’re lacking, but the type and suitability of properties coming to market – be that new or existing homes.”

By Joshua Searle

Source: The Herald

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Housing supply rising faster in rural markets with 19.2% increase in new listings

After months of low supply in the UK housing market, the number of listings is finally starting to rise, according to new data from Knight Frank.

Late into the spring market, supply is picking up as economic jitters mount and a belief grows that house prices may be peaking.

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Listings have been low since the end of the stamp duty holiday last September as owners hesitated due to a lack of purchase options. The result was a vicious circle of low supply that led to double-digit house price growth, spurred on by low mortgage rates, savings accumulated during the pandemic and the so-called ‘race for space’.

However, as stock levels increase it is not a uniform process across the country, data from OnTheMarket shows.

There was a 19.2% increase in the number of new listings between January and April this year in England and Wales. However, while there was an increase of only 5.7% in London (the smallest rise), the number of new properties listed for sale in Wales jumped by a third.

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The disparity reflects how supply is building more quickly in rural rather than urban markets.

The 20 local authorities that registered the biggest increase in supply over the period were, on average, classified as 55% urban. For the bottom 20 areas (where supply fell), they were classified as 92% urban on average.

James Cleland, head of the country business at Knight Frank, commented: “I suspect it is a hangover from last year when so many rural owners didn’t list their house as they didn’t think they would be able to find anything to move to. What was a vicious circle is becoming a virtuous circle as higher levels of supply leads to more stock coming on.

“A stronger sense of seasonality in more rural areas will have contributed to supply rising more quickly in the first few months of the year. It’s also likely that in urban centres like London, sellers are less motivated by concerns over peaking property prices after weaker growth during the pandemic.”

By Rozi Jones

Source: Property Reporter

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UK Housing Market Slowing After Prices Hit Record High

The average price of a UK home has topped £250,000 for the first time, but the proportion of sellers applying discounts to properties is increasing, according to an index.

Typical property prices hit £250,200 in April but the pace of price growth is slowing, Zoopla said.

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House prices increased by 8.4% in the year to April, cooling down from 9% growth in March.

Zoopla said it expects the rate of house price growth to slow further, to 3% by the end of the year.

It said that since the second half of April, around one in 20 properties have had price reductions of 5% or more – an increase from one in 22 properties with reductions during the previous month.

Where prices are being cut, the average reduction is 9% – and when applied to the average home value, this equals a price reduction of around £22,500.

Sellers are also waiting slightly longer typically to achieve a sale, Zoopla said.

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Outside London, the average time between a three-bedroom house being listed for sale and a sale being agreed increased from 16 days in March to 18 days in April. In London, this average figure increased from 17 days in March to 21 days in April.

Buyer demand for properties however continues to outweigh supply.

Demand is currently 61% up on the five-year average, while the supply of homes for sale is down by 37% on this measure, Zoopla said.

Grainne Gilmore, head of research at Zoopla, said: “High levels of buyer demand mean that the market is still moving quickly, but the time to sell – the time taken between listing a property and agreeing a sale – is starting to rise across most property types in most locations.

“We expect that this measure will continue to rise during the rest of the year as buyer demand levels start to fall, punctured by changing sentiment around the cost of living and personal finances.

“Another signal that the market is starting to soften is the number of properties where asking prices are being cut by more than 5%.

“Some one in 20 properties has been re-priced this month, with the average new asking prices some 9% below the original.

“The annual rate of price growth will ease this year – on a monthly basis, price growth has already moderated.

“A continuation of this trend, even with some small monthly declines, means price growth will reach 3% by the end of the year.”

Vincent Dennington, director at estate agent John D Wood & Co, said: “We are starting to see more and more price reductions on property portals, which is perhaps an early indication that the market is slowing down.

“However, this may also be a sign that properties have been initially overpriced and are not achieving any interest from potential buyers; therefore needing to be adjusted correctly to ensure a reduction generates new interest and ultimately offers.”

He added: “Currently, the market remains buoyant enough that should a property come to market competitively priced, it is likely to create a multi-bid scenario, resulting in final offers going over the guide price.”

By Vicky Shaw

Source: Bloomberg

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UK house prices in March increased 9.8%: ONS

House prices in the UK have increased 9.8% in March on an annual basis, with the average property in the UK being valued at £278,000, according to the latest UK house price index data from the Office for National Statistics.

The data found that house prices in the UK have decreased from 11.3% in February this year.

Andrew Montlake comments: “House prices cooled in March relative to February and we can expect more of this throughout the year given the frightening level of inflation. The Stamp Duty holiday, record low interest rates and the race for space triggered an unprecedented surge in demand and activity during the pandemic, but those days are now over.”

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“9% inflation, rising interest rates and a potential recession ahead will impact demand while lenders are becoming ever more cautious, which will restrict what people can borrow. This will almost certainly see the rate of price growth slow during 2022 and into next year. Only the entrenched lack of supply can prevent prices from falling,” Montlake explains.

Average house prices increased over the year in England to £298,000 (9.9%), in Wales to £206,000 (11.7%), in Scotland to £181,000 (8.0%) and in Northern Ireland to £165,000 (10.4%).

London continues to see the lowest annual growth, as average prices increased by 4.8% over the year to March 2022, down from 7.8% in February 2022.

Despite being the region with the lowest annual growth, London’s average house prices remain the most expensive of any region in the UK, with an average price of £524,000 in March 2022.

The North East continued to have the lowest average house price at £155,000.

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On a non-seasonally adjusted basis, average house prices in the UK increased by 0.3% between February and March 2022, down from 1.6% during the same period a year earlier.

Average house prices in the UK on a seasonally adjusted basis, increased by 0.6% between February and March 2022, following an increase of 0.9% in the previous month.

Simon McCulloch says: “More properties are coming onto market and selling faster than ever, and at record-breaking prices, yet house prices continue to rise. Even for first-time buyers, our data shows new instructions are up 54% from 2020.”

“However, the rising cost of living, lenders pulling competitive rates, and base rate rises mean many buyers are becoming limited in what they can afford. Ultimately, there’s a clear dichotomy between rising prices, greater supply, and constrained affordability and we’ll see within the coming months if economic pressures test the market’s current trajectory.”

“It is time the analogue conveyancing process was digitised. Whether you’re a lender, buyer, homeowner, solicitor, or estate agent, adopting new technology will help make the transition for all parties involved quicker and more efficient,” McCulloch adds.

Anne Clare Harper explains: “Much like for the wider economy, house price inflation is being driven by shortages of supply. This shortage relates to housing in general, and to quality housing that people can afford, in the places they want and need to live in, in particular.”

“The shortage of suitable, affordable housing is being made worse by planning backlogs from lockdown alongside labour and material shortages and inflationary pressures, as well as the fact that many new-build schemes are unaffordable to local people. Construction material prices rose by over 20 per cent (including 10 to15 per cent inflation in the first quarter of this year according to The Construction Leadership Council). So, the trend is unlikely to reverse any time soon.”

“The result is an ongoing and growing constraint on the affordability of home ownership. In England, full-time employees could expect to spend 9.1 times their annual earnings on purchasing a home in 2021, and this figure is not improving with the latest HPI data highlighting that house price growth continues to outpace wage growth.”

“This rate of inflation increases the importance of the Private Rental Sector, which is essential for providing safe, quality housing to millions of people and families for whom home ownership is not the right path to follow.”

“This is a major reason why we are seeing growing appetite from investors such as pension funds, which increasingly realise they play a major role in plugging the gap in quality, affordable homes for people and communities across the UK.”

By Becky Bellamy

Source: Mortgage Finance Gazette

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House prices rise for 10th consecutive month to hit record amount: Halifax

Average house prices rose 10.8% on an annual basis in April to hit a record £286,079, says the latest Halifax house price index.

This rise is down from 11.1% posted in March, but is still the tenth consecutive monthly rise in prices, the longest run since 2016.

The report says: “The property market has continued to defy expectations in recent times, with the rate of house price growth accelerating since the end of the stamp duty holiday last year.”

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Average house prices have risen by £47,568 over the last two years. It took the previous five and half years to make a similar jump of £47,689 between October 2014 and April 2020, the survey points out.

House prices have fallen in just four months since the start of the pandemic in March 2020. The index adds that the average monthly gain of 0.9% during the past year is more than double the typical monthly increase seen over the previous decade.

However, the report says it expects house prices to slow later this year, as rising inflation and interest rates bite into household budgets.

Yesterday, the Bank of England lifted the base rate by 25 basis points to 1%, the highest level since 2009.

On a regional basis, Northern Ireland has overtaken the South West of England as the UK’s strongest performer in terms of annual price house inflation, now at 14.9%, its highest rate of annual growth since December 2007.

Halifax managing director Russell Galley says: “Housing transactions and mortgage approvals remain above pre-pandemic levels and the continued growth in new buyer enquiries suggests activity will remain heightened in the short-term.

“The imbalance between supply and demand persists, with an insufficient number of new properties coming onto the market to meet the needs of prospective buyers and strong competition to secure properties driving up prices.

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“There remains evidence that this demand is centred on larger, family homes, rather than smaller properties such as flats. Over the past year, prices for detached and semi-detached properties have risen by over 12%, compared to just 7.1% for flats. The net cash increase for detached properties, at just under £50,000 over the past year, is nearly five times more than for flats.

“For now, at least, despite the current economic uncertainty, the strong increases we’ve seen in house prices show little sign of abating. Demand in the housing market remains firm and mortgage servicing costs are relatively stable with fixed-rate deals making up around 80% of mortgages on homes across the industry, protecting many households from the effects of rate rises so far.

“However, the headwinds facing the wider economy cannot be ignored. The house price to income ratio is already at its highest ever level, and with interest rates on the rise and inflation further squeezing household budgets, it remains likely that the rate of house price growth will slow by the end of this year.”

Lucy Pendleton, a property expert at independent estate agents James Pendleton, says: “This is a housing market with its fingers in its ears, ignoring the gales blowing around it and blithely carrying on.

“With all the economic speedbumps, the threat of inflation topping 10% and a spike in unemployment, it’s amazing how little things have been affected. Yet a tenth successive monthly rise has been notched up and annual growth is still in double digits.

“Appropriately for a market separated from reality, it is detached properties that are seeing the biggest growth, suggesting upsizers are still having to fight hardest over dwindling stock.

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“The ongoing lack of supply and the savings left in some people’s pandemic piggy banks seem enough to fuel new buyer enquiries and keep the show on the road for now. Yet the latest interest rate rise to 1% is only going to make getting a mortgage tougher in the months to come.”

Shaw Financial Services founder Lewis Shaw adds: “April may have been another barnstorming month, but the wheels could come off the property market spectacularly during the second half of the year. Will house prices fall? Probably not, mainly due to the lack of supply.

“Are mortgage lenders starting to show signs of tightening their belts and taking a more cautious approach? Yes. That will temper transaction levels in the months ahead. A lot will depend on the strength of the jobs market and how it holds up under the countless headwinds it faces. But there is a very real risk of recession ahead.”

By Roger Baird

Source: Mortgage Finance Gazette

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Nationwide reveals April house price index

Annual house price growth has slowed down slightly in April, but has remained in double digits for the 11th time in the past 12 months, the latest Nationwide House Price Index has today revealed.

UK house prices grew by 12.1% year-on-year in April, down from 14.3% in March. Prices rose by 0.3% month-on-month, after taking account of seasonal effects – the ninth consecutive monthly increase, though this is the smallest monthly gain since September last year.

Robert Gardner, Nationwide’s chief economist, pointed out that housing market activity has remained solid with mortgage approvals continuing to run above pre-COVID levels.

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“Demand is being supported by robust labour market conditions, where employment growth has remained strong, and the unemployment rate has fallen back to pre-pandemic lows. With the stock of homes on the market still low, this has translated into continued upward pressure on house prices,” he said.

However, Gardner was surprised that conditions have remained so buoyant, given mounting pressure on household budgets, which has severely dented consumer confidence.

“Consumers’ expectations of their own personal finances over the next 12 months have dropped to levels last seen during the depths of the global financial crisis more than a decade ago. Moreover, housing affordability has deteriorated because house price growth has been outstripping income growth by a wide margin over the past two years, while more recently, borrowing costs have increased,” the economist said.

“Risks to growth have been mounting for some time, so it’s unsurprising to see prices moderating slightly in this latest data,” Nicky Stevenson, managing director at national estate agent group Fine & Country, said. “Whether this is a harbinger of things to come remains unclear and experts continue to debate whether the fundamentals of the market can continue to support double digit growth for much longer.”

According to Gardner, however, it is expected that the housing market would continue to slow down in the coming quarters.

“The squeeze on household incomes is set to intensify with inflation expected to rise further, perhaps reaching double digits in the quarters ahead if global energy prices remain high. Moreover, assuming that labour market conditions remain strong, the Bank of England is likely to raise interest rates further, which will also exert a drag on the market if this feeds through to mortgage rates,” he said.

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Andrew Montlake agreed that the slowing in growth seen in April is likely to continue throughout 2022.

“We are now seeing some real signs of a storm blowing in. Inflation and the cost-of-living crisis, together with the continuing war in Ukraine, are making buyers more cautious and are creating a nervousness among lenders that may see them cut their cloth accordingly in the second half of this year,” he said.

“The rate of price growth is likely to continue to fall during 2022 but the drastic lack of supply could prevent prices from falling,” Montlake added.

“A slowdown in the rate of price growth was always on the cards given the huge spike in the cost-of-living and higher mortgage rates,” Dominik Lipnicki said. “The lack of stock will help support prices, even if the rate of growth continues to slow.”

Tomer Aboody, director of property lender MT Finance, said that with interest rates going up, buyers are rushing to secure a mortgage now before further increases are implemented.

“As rates rise and inflation increases, a lack of confidence is likely to start to filter through, leading to a slow calming of the market in coming months,” he added.

Meanwhile, a survey of around 3,000 consumers across the UK, conducted online by Censuswide on behalf of Nationwide, seems to explain why market activity remained buoyant despite rising costs.

Almost four in 10 (38%) respondents stated that they were either in the process of moving or considering a move.

This proportion was particularly high in London, where almost half said they were moving or considering a move. Even in Wales, where the share was lowest, more than 25% were either moving or considering a move. This is very high, according to Gardner, given that only around 5% of the housing stock turns over in a typical year in the UK.

The survey also showed that the proportion of people considering a move was highest among private renters (45%), those living with family (44%), those owning a home with a mortgage (42%), and those owning their property outright (30%).

“Interestingly, despite mounting pressure on household finances, the share of people moving or considering a move was higher than during the height of the pandemic in April last year across all tenure types, as shown below,” Gardner observed.

The survey results also suggest that shifts in housing preferences as a result of the pandemic are continuing to support housing market activity, though to less of an extent than at this time last year.

Around a quarter (24%) of those moving or considering a move said that they needed to move to a larger property, and for most age groups, a majority are still looking to move to less urban environments.

However, the proportion of those citing a desire to get away from city life, or gain access to a garden or outside space has declined substantially to 12% and 15% respectively, down from 25% and 28% in April 2021.

For most movers and potential movers, the majority of those surveyed are looking to trade up – the exception being among those aged 55 and above, where nearly 40% are looking to move to a smaller property compared to just 7% looking to move to a larger property.

Financial reasons are cited as a factor motivating a move by a sizeable minority, with 17% of those moving or considering a move saying they were doing so at least in part to reduce spending on housing, either by moving to a different area and/or by moving to a smaller property.

Iain McKenzie, chief executive at The Guild of Property Professionals, stated that the demand to move, combined with solid mortgage approval numbers, will help prop up house prices.

“Across all ages, movers are still looking for properties away from urban environments, and the amount of people working from home will keep prices higher in commuter areas,” McKenzie said.

By Rommel Lontayao

Source: Mortgage Introducer

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UK housing market shows signs of stability with Brits’ reluctant to spend

The UK housing market could be returning to stability, say analysts, before deals pick up as warmer weather blankets the country.

Residential transactions for March have plunged more than a third in comparison with the same month last year, according to the government’s latest figures, after a continued, pandemic-era, buying frenzy.

Although deals have climbed 18 per cent higher than February, HMRC data showed, as gloomier weather recedes.

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“Could this be the turning point with spring and summer upon us when the market finally gets some stability and pricing normalises?,” Tomer Aboody, director of property lender MT Finance, questioned.

It follows the end of the stamp duty holiday, which saw real estate agencies report record activity as buyers raced to climb the property ladder.

Despite the logistics real estate market taking off in the UK, as businesses seek to bring distribution hubs closer to home, non-residential deals sank nearly six per cent year-on-year – but have surged 36.6 per cent in comparison with February.

With non-residential transactions “still trailing behind” their residential counterparts, Aboody urged for business rates reform, in a bid to lure retailers back to high streets after a bleak pandemic period.

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Cost of living squeeze

The levelling out of transactions year-on-year could signal how potential buyers are feeling less reluctant to splash the cash given the UK’s economic and inflationary position.

“The rising cost of living and interest rates, especially for those on tight budgets, are contributing to an easing of price growth and a drop in sales,” said north London estate agent Jeremy Leaf.

However, “Demand still comfortably exceeds supply and correctly-priced houses continue to attract considerable interest while mortgage repayments remain relatively affordable,” he added.

Senior pensions and retirement analyst at Hargreaves Lansdown, Helen Morrissey, chimed, explaining that Brits’ squeezed finances are ‘dampening’ the appetite for new homes.

“Comparisons with last year are tricky with the stamp duty holiday and the pandemic race for space causing a huge surge in activity but while the number of transactions is down on this time last year, it is still a massive 18 per cent up on last month’s figure,” she continued.

“How long the market can maintain this momentum remains to be seen as there are significant headwinds incoming.”


Source: City AM

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House prices to reach record high, shows Reallymoving data

The average house price in England and Wales is set to continue to rise over the next quarter to a new record high of £389,712 in June 2022, according to Reallymoving’s March House Price Forecast.

The forward-looking index, which captures the purchase price buyers agree to pay when they search for conveyancing quotes, suggests that the imbalance between supply and demand will continue to drive prices upwards through the spring despite growing pressures on household finances and rising borrowing costs.

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The supply crunch, which has seen the volume of properties for sale plummet to record lows, combined with unseasonably strong buyer demand, is preventing sale prices from falling, Reallymoving’s data found.

Based on deals already agreed between buyers and sellers, it predicted that prices will rise by +4.7% in April and +6.0% in May before slowing to growth of +1.3% in June.

The rises are said to be a direct result of buyer competition for a limited supply of homes during the early months of the year.

After the Bank of England increased the base rate 0.75% last month, the current run of house price growth is likely to slow later this year, according to the data.

House prices have risen by more than 10% compared to this time last year and are £66,000 higher than when the pandemic started.

For first-time buyers that are tempted to wait for a decline in house prices, Reallymoving says buying with a long-term view will help ride out any short-term fluctuations and locking in a fixed-rate deal will help save money in the long run.

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Meanwhile, for those looking to downsize to a smaller property as the cost living cost continues to rise, data suggests releasing equity now will help to secure the maximum price for the property.

Reallymoving chief executive Rob Houghton says: “House price forecasts for the coming quarter suggest we’re heading into a period of strong price growth, but when taken in the wider context what we’re actually seeing are prices being inflated by a severe supply squeeze.”

Houghton explains: “This is forcing the market upwards, masking the impact of inflation and rising costs on household budgets which we would normally expect to rein in price growth.”

“Having less money in their pockets will ultimately deter people from taking on more debt as they move up the ladder, and at some point in the near future, this will slow house price growth. Much will depend on the volume of new listings we see coming onto the market and the speed at which lenders push up the price of fixed rate mortgages,” he adds.

By Becky Bellamy

Source: Mortgage Finance Gazette

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UK housing market remains solid despite economic worries – RICS

The UK housing market had solid growth in March as the number of homes listed for sale rose despite worries about higher living costs and interest rates, a survey showed.

The Royal Institution of Chartered Surveyors’ (RICS) residential market survey found that +8% of estate agents had a rise in fresh listings and that new buyer enquiries rose with +9% of respondents reporting an increase. This was the first time since the start of the pandemic that supply and demand had been so closely in line.

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The number of agreed sales was unchanged from February at +9%, showing a steady increase in transactions. But the average number of properties on agents’ books stayed close to historic lows. RICS’ figures show the difference between agents reporting increases and declines.

Agents were moderately optimistic about the outlook with +16% of respondents expecting activity to increase over the next three months and with agents expecting volumes to be broadly stable over the coming year.

House prices continued their upward trend with +74% of agents reporting increases, in line with the trend over the past year. Northern Ireland, Wales and northern England had the biggest increases.

Respondents expect prices to keep rising over the next three and 12 months despite worries about higher living costs and potential interest rate increases designed to combat inflation. In the rental market landlord instructions rose for the first time since July 2020 but demand still outstrips supply and rents are expected to rise.

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Simon Rubinsohn, RICS’ chief economists, said: “Despite mounting concerns about both the macro environment and the war in Ukraine, for now the feedback to the RICS survey shows the housing market remains resilient. Rising interest rates have begun to push up the cost of mortgage finance but debt servicing remains low in a historic context which helps to explain why the new buyer enquiries indicator remains in positive territory.”

The UK’s housing market boomed during the pandemic, driven by a temporary cut to stamp duty and households reassessing their property needs with the ability to work from home. Activity has reduced from the frenzy of 2021 but many experts have been surprised by how long the market has stayed busy.

Rubinsohn said: “It is encouraging that a little more stock appears to be returning to the market. This is still early days in that inventory remains not far off historic lows but if the trend continues, it could help to create a better balance between supply and demand. That said, there is little evidence of this outcome materialising in the 12-month metrics which continue to point to further increases in prices and a flatter pattern in transactions.”

By Sean Farrell

Source: ShareCast

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UK house prices increase 10.9% from February 2021

House prices in the UK have increased 10.9% on an annual basis, with the average property in the UK being valued at £276,755, according to the latest data from the government’s house price index.

The data found that house prices in the UK have risen by 0.5% since January this year.

The UK Property Transactions Statistics showed that in February 2022, on a seasonally adjusted basis, the estimated number of transactions of residential properties with a value of £40,000 or greater was 112,240, representing a 20.8% decrease compared to February 2021.

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Between January and February 2022, UK transactions increased by 4.4% on a seasonally adjusted basis.

SPF Private Clients managing director of mortgage broker Mark Harris suggests that the “ready availability of cheap finance” is one of the contributing factors to higher house prices.

Harris comments: “Lenders remain keen to lend, with borrowers opting for longer-term fixes in order to counter the considerable uncertainty in the world.”

“While changes are being consulted on to relax some affordability criteria and allow certain buyers to borrow more, a return to irresponsible lending is unlikely given there would still be barriers in place,” he adds.

In England, house prices have on average increased by 0.9% since the start of this year, while an annual price rise of 10.7% takes the average property value to £295,888.

For London, house prices have on average gone up by 2.2% since January, while on an annual basis prices have risen by 8.1%, which has increased the average property value to £529,882.

Although London may not be seeing the fastest levels of growth compared with other parts of the country, Antony Roberts director Alex Lyle says: “London continues its upwards trend in prices, with detached family homes doing particularly well.”

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“We continue to see large numbers of viewings, multiple offers and sealed bid scenarios, with buyers on our patch anxious not so much about rising house prices or interest rates but limited choice.”

Meanwhile, house prices in Wales have fallen on average by 0.7% since January 2022, however, on an annual basis, the average property value has increased by 14.2% to £205,114.

Regional data showed that the East of England experienced the greatest increase in its average property value over the last 12 months with a movement of 12.5%.

The East Midlands saw the most significant monthly price fall with a movement of -0.4%.

London experienced the greatest monthly growth with an increase of 2.2% but saw the lowest annual price growth with an increase of 8.1%.

Henry Dannell director Geoff Garrett says: “The market has continued to excel despite what is a very delicate economic landscape and while the cost of borrowing has remained fairly favourable, those currently looking to buy should tread very cautiously with regard to over borrowing.”

“It remains to be seen as to whether the cost of a mortgage will climb substantially this year, but with the wider cost of living also putting a squeeze on household finances, those borrowing well beyond their means may fall into financial difficulty further down the line,” Garrett adds.

With soaring inflation, the ongoing cost of living crisis and higher energy bills, Quilter mortgage expert Karen Noye says “many people are feeling the squeeze financially”.

Adding into the mix, the new energy price cap and increase in national insurance, alongside an increase in moving costs, Noye suggests house prices could dip over the coming months.

She comments: “While house prices have remained robust for the time being, how the housing market truly reacts to the current circumstances is yet to be seen. However, it is unlikely that house prices will be able to continue rising at the same rate seen in recent times – particularly against the backdrop of an economy already trying to recover from the impact of the pandemic.”

“If a slowdown does begin to materialise, a gradual fall in house prices is expected as opposed to a sudden drop. At present, there remains too much demand and too little stock, so house prices will likely remain high for some time yet,” Noye concludes.

By Becky Bellamy

Source: Mortgage Finance Gazette

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