9:32 AM, 7th October 2024, About 3 months ago
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House prices in the UK continued their upward trajectory in September, rising by 0.3% compared to the previous month, Halifax reports.
This marks the third consecutive month of increases, bringing the annual growth rate to 4.7%, the highest level since November 2022.
Despite the recent gains, the overall trend in house price growth remains relatively modest.
The average property price is now £293,399 – close to the record high of £293,507 set in June 2022.
Amanda Bryden, the head of mortgages at Halifax, said: “It’s essential to view these recent gains in context. While the typical property value has risen by around £13,000 over the past year, this increase is largely a recovery of the ground lost over the previous 12 months.
“Looking back two years, prices have increased by just +0.4% (£1,202).”
She adds: “Market conditions have steadily improved over the summer and into early autumn. Mortgage affordability has been easing thanks to strong wage growth and falling interest rates.
“This has boosted confidence among potential buyers, with the number of mortgages agreed up over 40% in the last year and now at their highest level since July 2022.”
Northern Ireland maintained its position as the region with the most rapid house price growth, experiencing a 9.7% annual increase in September.
The average property value in Northern Ireland now stands at £203,593.
Wales also witnessed robust growth, with house prices rising by 4.4% compared to the previous year with an average price tag of £224,119.
Scotland’s house prices experienced a more moderate rise, increasing by 2.1% year-on-year to an average of £205,718.
The North West region of England continued to lead the English regions in terms of house price growth, with a 5.1% increase over the past year to reach £234,355.
London remains the UK’s most expensive property market, with average prices reaching £539,238, a 2.6% increase from the previous year – but below the peak price of £552,592, recorded in August 2022.
Nathan Emerson, Propertymark’s chief executive, said: “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.”
Matt Thompson, the head of sales at Chestertons, said: “Lower interest rates and sub-4% mortgage products saw more house hunters start their property search in September.
“The uplift in buyer activity, and looming changes to Capital Gains Tax in the upcoming Autumn Budget, also motivated sellers to put their property up for sale.
“We expect this level of market activity to continue and could see an additional boost in buyer motivation if the Bank of England decides to cut interest rates in November.”
Karen Noye, a mortgage expert at Quilter, said: “As rates have fallen from their recent peaks, potential buyers are finding themselves with more financing options helping drive up demand.
“Currently, some lenders offer deals around the 4% mark, a stark contrast to the 5% or higher rates seen in the immediate aftermath of the 2022 mini-budget and beyond.
“This reduction in rates has enabled buyers to secure larger mortgages, making previously unaffordable properties more attainable and boosting buyer confidence.”
Tom Bill, the head of UK residential research at Knight Frank, said: “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 is better than feared, there is likely to be a relief bounce in activity before Christmas that lasts into next spring.”
