The latest data on UK house prices has indicated they are still rising despite the economic headwinds - but at a slower rate.
Halifax has revealed average house prices rose by 0.4 per cent in August, compared with a 0.1 per cent drop in July. On an annual basis the average UK price is now £294,260, up 11.5 per cent year-on-year, compared with 11.8 per cent in July.
While this represents a mild easing of house price inflation, it is not yet a clear sign of a housing market correction, with homes still at record prices.
Any aspiring housebuyer seeking a mortgage broker in Derby may also want to note regional variations, as the East Midlands has performed differently to some other parts of the country. For example, price growth is not as strong as in Wales and south west England, which continue to see the highest growth, while London’s growth, although accelerating, still trails the rest of the UK.
The Halifax figures are backed up the latest survey by the Royal Institution of Chartered Surveyors (RICS). This survey uses a different metric, that of how many surveyors are seeing prices rising compared to the number seeing prices fall. The latest figures show a positive balance of 53 per cent seeing price rises in August, but this was down on July’s 62 per cent.
While this was well above the long-term average of 13 per cent, the positive balance was lower than in any previous month this year and thus adds to suggestions the housing market is cooling. Further evidence of this comes from the fact that RICS noted a significant drop in new buyer enquiries, to the lowest level since April 2020, when the country was in lockdown.
The picture that emerges, therefore, is one of a cooling market, with Halifax director of mortgage Richard Kinnaird forecasting a “more challenging period for house prices” ahead, not least as the Bank of England may raise interest rates again. That is not the same, however, as predicting a significant fall.
Mortgage borrowers cannot, at least yet, expect housing costs to drop and will need to plan accordingly.
