UK house price growth picks up steam

UK house price growth picks up steam

9:28 AM, 1st August 2024, About A day ago

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The average UK house price climbed 0.3% month-on-month in July, marking the fastest pace of growth since December 2022, new figures from Nationwide reveal.

It says the annual rate of house price inflation is 2.1%, up from 1.5% in June.

Despite the uptick, prices remain 2.8% below the peak reached in summer 2022.

The average house price is £266,334.

Market activity has been holding steady

Nationwide’s chief economist, Robert Gardner, said: “Housing market activity has been holding relatively steady in recent months with the number of mortgages approved for house purchase at around 60,000 per month.

“While this is still c.10% below the level prevailing before the pandemic struck, it is still a respectable pace given the higher interest rate environment.

“For example, for borrowers with a 25% deposit, the rate on a five-year fixed rate deal has been around 4.6% in recent months, more than double the 1.9% average recorded in 2019.

“As a result, affordability is still stretched for many prospective buyers.”

Fastest rate of house price growth

Director of Benham and Reeves, Marc von Grundherr, said: “The fastest rate of house price growth since December 2022 demonstrates just how much market conditions have improved so far this year and it’s clear that buyer confidence is high, despite the fact that interest rates are yet to come down.

“For those planning to make their move in 2024, now is the time to do so, as buyer demand is only likely to increase when interest rates are finally cut, making it very much a seller’s market at present.”

‘Property market warmed up a little’

Sarah Coles, the head of personal finance at Hargreaves Lansdown, said: “The property market warmed up a little this month, delivering its fastest annual growth in over 18 months.

“Prices are very gradually closing in on the all-time highs of two years ago, and there’s cautious optimism seeping into the bones of the market.

“Let’s not get carried away though. Prices are hardly shooting up, and properties aren’t flying off the shelves.”

She adds: “The number of mortgages approved for purchases in the next couple of months is still 10% below the typical rate before the pandemic, so we’re not going to see anything dramatic in the immediate future.”


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