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House price growth jumps in ‘insane September’

House prices in September experienced a growth rate not seen since February 2007, as buyers rushed to beat the final stamp duty holiday deadline.

The Halifax house price index, published today (October 7), showed prices rose by 1.7 per cent in the month, up from 0.8 per cent in August.

Annual house price inflation was 7.4 per cent in the year, up from 7.2 per cent in August, with the average house price in the UK now worth £267,587.

This reversed the recent three-month downward trend in annual growth, which peaked at 9.6 per cent in May.

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The rush to beat the stamp duty deadline could have played a part, experts believe.

The stamp duty nil rate band, which had been raised to £500,000 in July last year, dropped to £250,000 in June and returned to £125,000 at the end of September.

Russell Galley, managing director at Halifax, said: “While the end of the stamp duty holiday in England – and a desire amongst homebuyers to close deals at speed – may have played some part in these figures, it’s important to remember that most mortgages agreed in September would not have completed before the tax break expired. This shows that multiple factors have played a significant role in house price developments during the pandemic.”

Galley said the “race-for-space” as people changed their preferences had an impact, as well as the limited housing supply.

He added: “With estate agents reporting a further reduction in the number of houses for sale, this is likely to underpin average prices – though not the recent rate of price growth – into next year.”

George Franks, co-founder of London-based estate agents Radstock Property, said: “September’s insane price growth offers yet more proof that life and work changes brought on by the pandemic have been equally, if not more, influential on the housing market than the stamp duty holiday.”

He also pointed to the lack of supply, “coupled with absurdly low mortgage rates”, which he said would support prices in the short term and negate the impact of rising inflation.

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“The fundamentals continue to favour a stabilisation of the market rather than a fall in values.”

James Forrester, managing director of Barrows and Forrester, agreed the stamp duty break had less of an influence than many had thought.

“While there will no doubt be some form of erratic price movement on a month to month basis until the market settles down for good, we don’t expect the removal of this tax incentive to significantly impact the market at any level,” he said.

But Karthik Srivats said the data showed that things had not got any easier for first-time buyers.

“Growth in prices continues to outstrip wages and raising a deposit the old-fashioned way through patient savings remains an unrealistic dream for most.”

He added one piece of good news for first-time buyers was that they had access to the stamp duty relief on purchases of up to £300,000 which may give them a “slight edge” going forward.

He added: “Rock bottom interest rates and a continued demand for bigger homes with more outdoor space may well support buyer activity for some time to come.”

By Sally Hickey

Source: FT Adviser

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UK house prices forecast to rise by up to 3.5% a year between 2022 and 2024

Hamptons has released its housing market forecast for next year and beyond, predicting that property price growth will remain above pre-pandemic levels as the cycle ends in 2024.

The company believes that summer 2021 marked peak house price growth. As we move into autumn and winter they expect price growth to slow, ending the year at 4.5% across Great Britain.

It says that a second wave of lockdown-induced demand will keep price growth in positive territory at 3.5% in 2022, 3% in 2023 and 2.5% in 2024.

London is set to underperform the rest of the country until the house price cycle ends in 2024. They forecast prices in the capital to end the year up 1.5% and then rise by 1.0% in 2022, 1.5% in 2023, before accelerating to 3% in 2024.

The North East will be the top performer over the next four years. Hamptons expect house prices to rise 21.5% in Q4 2024, outpacing the Great Britain average of 13.5%.

A record-breaking first half of the year means that more homes will have sold in 2021 than in any year since 2007. The property firm forecast 1.5 million completions in Great Britain in 2021.

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Covid-19 induced changes mean households will make more moves than pre-pandemic times. It is forecast that transactions will fall marginally to 1.25 million in 2022 before reaching a new normal of 1.3 million in 2023 and 2024.

The rapid pace of rental growth will slow. They expect rents in Great Britain to end the year up 3%, before slowing to 2.5% in 2022 as affordability bites.

By the end of 2024 Hamptons expect rents to have risen by 10.0%, led by Southern regions. Meanwhile, London will lag until growth accelerates in 2024.

Aneisha Beveridge, head of Research at Hamptons, said: “The housing market has confounded expectations and forecasts in past months. Back in the autumn of 2020, such were the economic challenges being faced that we could not have envisaged the extraordinary demand for relocation which we have seen this year. But there has been a huge attitudinal change towards property, which cannot be attributed to the stamp duty holiday alone.

“People now place a higher value on their homes, having have spent more time in them than ever before. Flexible and remote working, which look set to continue, have encouraged households to make bigger moves. As a result, more homes are likely to have been sold in 2021 than in any year since 2007. This is why we also think housing activity will surpass pre-pandemic times in 2022 and beyond.

“The pandemic has accelerated the closing of the house price gap between London and the rest of the country. Even so, we still expect London to underperform the rest of the country until 2024, when the cycle is likely to end. While we will see a degree of levelling up over the next few years, the gap between house prices in the capital and the other regions is likely to be wider than that seen at the end of the previous cycle in 2007. And this divergence will set the pattern for future performance.”

2021

Hamptons believe that summer 2021 marked peak house price growth across Great Britain, which is now expected to slow…

It says that the property market remains resilient as the stamp duty holiday draws to a close, but expects price growth to soften towards the end of the year.

The latest ONS data shows that residential property prices across Great Britain rose by 8% in the 12 months to July, down from a peak of 13.2% in June. The end of the stamp duty holiday combined with the fact that house prices were already recovering at the end of last year means they expect price growth to soften to 4.5% by Q4 2021. The average price of a home in Great Britain will end the year around £258,000, a similar level to July 2021.

While growth will slow as the year draws to a close, 2021 will remain a strong year for price appreciation, compared with the performance of recent previous years.

Scotland is set to the see the strongest price growth in Q4 2021 (7%), followed by the North East (6.5%) and Wales (5.5%). The average price of a home in the North East passed its pre-financial crisis peak for the first time this year.

Stretched affordability and the rise of flexible working have encouraged households to leave the capital, making London the weakest performing region. That said, Hamptons expect house prices in the capital to end the year up 1.5%, led by Outer London. The South East has been the biggest beneficiary of London outmigration. Here prices are expected to rise 5.0% in Q4 2021 compared with the same time last year.

2022

A second wave of lockdown-induced demand will keep price growth above pre-pandemic levels at 3.5% in 2022…

The estate agency says that a desire for more space and the flexibility for workers to split their time between the home and office will continue to stimulate the market in 2022. Equity-rich homeowners have dominated property market activity since the start of the pandemic, but they expect a second wave of lockdown-induced demand from those who have been unable to move this year.

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Hamptons expect mortgage rates for all borrowers to hit rock bottom in 2022 which will boost affordability, particularly for first-time buyers using bigger mortgages who saw rates soar during the early days of the pandemic.

House prices are forecast to rise by 3.5% across Great Britain in Q4 2022, in line with incomes. Price growth will be strongest in the Northern Regions, alongside Wales and Scotland, where affordability constraints are lower. Next year they expect the North East to record the strongest price growth (6.0%) followed by Scotland, Wales, Yorkshire & the Humber and the North West at 5%. Meanwhile, London will continue to see the weakest growth at 1%.

2023

The North will drive growth of 3% in 2023 as we approach the end of the regional cycle…

The economic recovery will determine the medium-term outlook for the housing market, with income growth and the pace of interest rate rises being particularly crucial to the direction of house prices. If interest rates increase more rapidly than expected, this will dent affordability and put a dampener on price growth.

However, the combination of an economic recovery and the enhanced importance of homes should keep activity above that of the pre-pandemic era. Hamptons forecast prices in Great Britain to rise 3% in Q4 2023.

2024

The cycle is likely to come to an end, but prices across the regions will be more widely spread than ever…

Typically, a house price cycle lasts around 16 years. The cycle usually begins with price growth in London steaming ahead, as it did between 2008 and 2016. This tends to be followed by a narrowing of the price gap between London and the regions as prices in the North catch up.

In the final year of a cycle, there are often signs of prices in London accelerating. And they expect this to be the case in 2024, with London house prices forecast to accelerate from 1.5% in Q4 2023 to 3.0% in Q4 2024.

However, the gap between London and the rest of the country is set to remain wider than at the end of previous cycles. With house prices in London forecast to rise by 7.0% over the next four-years, by the end of 2024 Hamptons expect the average home in the capital to cost 87% more than the national average. At the beginning of the house price cycle in 2008, the gap stood at 59%, rising to a peak of 117% in 2016.

Hamptons forecast the North East to see the strongest price growth over the next three years, with prices here expected to rise by 21.5%. But by 2024, the average price in the region will remain 41% below the national average, unless economic growth in the region picks up pace.

A new cycle begins…

Historically, the beginning of a new house price cycle has been synonymous with a sharp price correction. However, Hamptons do not expect this to be the case this time. A low interest-rate environment, tighter lending criteria coupled with the fact there’s been considerably less house price growth over the last 16 years means we’re more likely to see a continuation of modest price growth, such as we’ve witnessed during the last five years, rather than a boom followed by a bust.

To put this into context, between 1976 and 1991 house prices across Great Britain grew by 466%; between 1992 and 2007 they rose 265%; but between 2008 and 2024 we expect house prices to rise by 61%. This means a period of more balanced price growth across the regions as a new cycle dawns.

Regional house price forecast (Q4 of each year)

20202021 (F)2022 (F)2023 (F)2024 (F)4 Year Forecast
Greater London4.0%1.5%1.0%1.5%3.0%7.0%
East of England4.3%4.0%2.5%2.5%2.0%11.0%
South East4.7%5.0%3.0%2.5%2.0%12.5%
South West6.9%3.0%3.0%2.5%2.5%11.0%
East Midlands6.8%4.0%4.0%3.0%2.0%13.0%
West Midlands6.2%5.0%4.0%3.0%2.0%14.0%
Yorkshire & Humber7.5%4.0%5.0%4.0%3.0%16.0%
North West8.5%4.5%5.0%4.0%3.0%16.5%
North East6.2%6.5%6.0%5.0%4.0%21.5%
Wales7.4%5.5%5.0%3.5%3.0%17.0%
Scotland7.4%7.0%5.0%4.5%3.5%20.0%
Great Britain6.1%4.5%3.5%3.0%2.5%13.5%
Source: ONS & Hamptons

Transactions

Covid-19 induced changes mean households will make more moves than pre-pandemic

A record-breaking first half of the year means that more homes will have sold in 2021 than in any year since 2007.  We expect an increase in completions in September, as the stamp duty holiday comes to an end, but activity looks set to moderate as the year draws to a close.  By the end of 2021, we forecast 1.5 million homes to have been sold across Great Britain (chart 2).

In 2022, activity will be supported by households who have been unable to move home in 2021 as a result of affordability pressures, job uncertainty, or because they could not find a suitable property.

First-time buyer numbers should increase next year as the rates on higher-loan-to-value mortgage deals become cheaper.  We forecast there to be 1.25 million transactions across Great Britain in 2022, 17% fewer than 2021, but 22% more than in 2019 (chart 2).  This is a smaller hangover than after previous stamp duty holidays.

Thanks to a growing economy and low-interest rates, transactions will reach 1.3 million in 2023 and 2024 (chart 2).  As people spend more time in their homes and as a consequence are on the hunt for space, we expect transactions to remain above pre-pandemic levels.

Rental Growth

The rapid pace of growth is expected to slow

We forecast that the rapid pace of growth in the rental market will slow in 2022.  But the rate of increase should still be above pre-pandemic levels, supported by tenants’ willingness to pay for extra space and by unprecedentedly low levels of stock.

We forecast that rents will rise by an average of 2.5% in 2022 across Great Britain, following an increase of 3.0% this year (chart 3).  Growth will be dictated by what happens to peoples’ incomes in 2023 and 2024.

Growth is likely to be slower in the capital, particularly in Inner London where rents may not return to pre-pandemic levels until the middle of 2022.  We are forecasting overall rental growth in London of 0.5% this year, with pickup to 1.0% in 2022 and 1.5% in 2023.  Rental growth is then expected to accelerate to 3.5% in 2024 (chart 3).

The regions outside London, where affordability is less stretched, will see stronger growth.  Rents seem set to move in similar directions, with no significant North-South divide.  The South is likely to see marginally stronger growth, with rents here forecast to rise 14.5% by the end of 2024.

By MARC DA SILVA

Source: Property Industry Eye

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House price growth cooling but far from stagnant

The latest Halifax House Price Index is reporting year-on-year inflation cooling slightly to 7.1% with monthly increases in August of 0.7% and the average house price in the UK now standing at £262,954.

Russell Galley, Managing Director, Halifax, said: “Average house prices climbed again in August, with the cost of a property increasing by 0.7% or £1,789. Back-to-back monthly price gains have now pushed the cost of a typical home to a record of £262,954, topping the previous high (£261,642) recorded in May this year.

“Given the rapid gains seen over the past 12 months, August’s rise was relatively modest and the annual rate of house price inflation continued to slow, hitting a five-month low of 7.1% (versus 7.6% in July). However, compared to June 2020, when the housing market began to reopen from the first lockdown, prices remain more than £23,600 higher (or +9.9%).

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“Much of the impact from the stamp duty holiday has now left the market, as highlighted by the drop in industry transaction numbers compared to a year ago. However, while such Government schemes have provided vital stimulus, there have also been other significant drivers of house price inflation.

“We believe structural factors have driven record levels of buyer activity – such as the demand for more space amid greater home working. These trends look set to persist, and the price gains made since the start of the pandemic are unlikely to be reversed once the remaining tax break comes to an end later this month.

“Moreover, the macroeconomic environment is becoming increasingly positive, with job vacancies at a record high and consumer confidence returning to pre-pandemic levels. Coupled with a supply of properties for sale that looks increasingly tight, and barring any reimposition of lockdown measures or a significant increase in unemployment as job support schemes are unwound later this year, these factors should continue to support prices in the near-term.”

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Regions and nations house prices:

As would be expected given the trends at a UK level, annual house price inflation is slowing in most nations and regions. Wales remains the strongest performing area, with annual house price inflation at 11.6% and the only double-digit rise recorded in the UK during August.

The South West is also still experiencing strong growth at 9.6%, likely reflecting the ongoing demand for rural living within the region. Some areas do appear to have headroom for even stronger price growth, with annual house price inflation in the North East now up to 8%.

Northern Ireland has also seen prices rise further with annual house price inflation of 9.3% in August, though Scotland has seen price growth slow to 8.4%.

Greater London continues to lag the rest of the country, registering just a 1.3% annual increase in prices in August and, over the latest rolling three-monthly period, was the only region or nation to record a fall in prices (-0.3%). The year-over-year rise in London was also the weakest seen in 18 months. Though at a cost of £508,503, typical properties in the capital remain far above the national average national price.

Source: Property118

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Greater Manchester and Merseyside both see 20% house price rises

House price growth rates continue to climb strongly in England and Wales with prices increasing by a whopping 20% in both Greater Manchester and Merseyside, according to the latest e.surv Acadata House Price Index.

House prices are up 13.4% on an annual basis with the average house price now standing at £343,658.

The lowest growth has been seen in London where 10 boroughs reported annual price falls.

Richard Sexton, director at e.surv, said: “Overall, we can see the market continues to enjoy the effect of the government’s stamp duty holiday.

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“Buyers are still striving to complete purchases in time to benefit from the maximum tax break ahead of the change in June to a tapered deadline.

“Completion prices for transactions funded by both mortgages and cash grew by a startling 13.4% annually in May, and at a national level, prices in England and Wales rose on a monthly basis by some £1,800, or 0.5%.

“However, it is notable that the monthly price increases over the last three months are the lowest since June 2020, probably a reflection of the rapidly approaching end of the stamp duty holiday.

“Regionally, there has been continued price growth across Wales and all nine English regions. Prices performed particularly strongly in the North West which achieved its highest rate of annual house price growth,18.4%.

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“Growth in the North West is underpinned by activity in both Greater Manchester and Merseyside, where prices are increasing at a staggering annual rate of 20.9%. London and the South East have also seen growth, although at a lower level. It should be remembered that London property prices have already experienced a boom in the years following the global financial crisis, a rise not experienced by many other UK regions.

“Our property type data shows there has been a shift in the kind of homes that buyers are looking for.

“Working from home has encouraged interest in larger homes with gardens outside city centres.

“The demand for flats in central and inner areas of London and other cities has not been as strong as for other types of homes due to lifestyle changes and new working arrangements, alongside the absence of overseas buyers in prime central London due to COVIDrestrictions. The impact of the pandemic on flats has been amplified by the issues surrounding cladding for mortgage lenders.”

Source: Mortgage Introducer

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Nationwide: House prices up 10.9% in year to May

Annual house price growth was up 10.9% in May, the highest level in nearly seven years, the latest Nationwide house price index has revealed. On a month-on-month basis house prices were up 1.8% in May, down from the 2.3% rise recorded in April.

The figures leave the average price of a home at a new record high of £242,832.

Robert Gardner, Nationwide’s chief economist, said: “Housing market activity is likely to remain fairly buoyant over the next six months as a result of the stamp duty extension and additional support for the labour market included in the Budget, especially given continued low borrowing costs, improving credit availability and with many people still motivated to move as a result of changing housing preferences in the wake of the pandemic, as highlighted above.

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“With the stock of homes on the market constrained, there is scope for annual house price growth to accelerate further in the coming months, especially given the low base for comparison in early summer last year.

“Further ahead, the outlook for the market is far more uncertain.

“If unemployment rises sharply towards the end of the year as most analysts expect, there is scope for activity to slow, perhaps sharply, though even this could potentially be offset by ongoing shifts in housing preferences, if current trends are maintained.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said he expects prices to keep rising.

He said: “Although we may have been wondering if the glorious sunshine was ever going to arrive, the continued upwards trajectory of the property market comes as no real surprise. Buyers wanting more space, trying to take advantage of the extended stamp duty holiday and the lack of supply, are all pushing values upwards.

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“Lenders retain a strong appetite to lend with increased price competition leading to lower rates. Platform is launching the cheapest ever two-year fix this week, pegged at just 0.95%.

“Rates this low will continue to support the market, while the increased availability of low deposit mortgages will assist first-time buyers who are finding rising house prices increasingly difficult to deal with.’

Jeremy Leaf, north London estate agent and a former RICS residential chairman, added: ’These figures, though strong and coming on the back of last month’s fastest monthly rise since 2004, reflect market activity in the last few months when prices were turbo-charged by the extension of the stamp duty holiday, as well as continuing shortage of houses in particular, low mortgage rates and faster vaccine rollout.

“Looking forward, these factors aren’t likely to change anytime soon, even if demand cools a bit, which we are already starting to see. As a result, prices will soften but not correct and next month’s index is likely to show strong but more moderate growth.”

Source: Mortgage Introducer

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UK house prices hit new record high after growing at fastest rate in five years

UK house prices grew at the fastest pace in five years last month as the stamp duty holiday continued to buoy the market.

Average UK house prices in April reached a new record high of £258,204, an annual increase of 8.2 per cent and a monthly rise of 1.4 per cent.

Almost £20,000 has been added to the value of the average home since April last year, according to the latest Halifax House Price Index.

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“The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the Government scheme,” said Halifax managing director Russell Galley.

“ The influence of the stamp duty holiday will fade gradually over the coming months as it’s tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market.”

Boom in “full swing”

Laith Khalaf, financial analyst at AJ Bell, said: “The house price boom is still in full swing, as white line fever is pushing buyers into the market to take advantage of the recently extended stamp duty holiday.

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“Mortgage approvals have fallen back in recent months, which hints that some froth may be coming off the very top of the market. But we’re approaching the busy summer season, and there are plenty of tailwinds that will help to keep prices elevated moving forwards.

“The stamp duty holiday is gradually being tapered away by the end of September, but borrowing costs are still low, and the government continues to offer support in the form of Help to Buy and the Mortgage Guarantee Scheme. We also know that plenty of consumers have built up a war chest over the pandemic which can help them trade up the property market, perhaps to get some extra space for a home office.”

By Jessica Clark

Source: City AM

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UK house prices soared in February at the highest growth rate

UK house prices soared in February at the highest growth rate recorded in more than six years – but London lagged behind the rest of the country.

Average house prices across the UK increased 8.6 per cent in the year to February, up from eight per cent in January.

This is the highest house price growth recorded in the UK since October 2014.

The average UK house price was £250,000 this year, an increase of £20,000 compared to February last year, according to the latest figures from the Office for National Statistics.

London recorded the worst annual growth, as average UK house prices in the capital grew 4.6 per cent, down from 5.7 per cent in January.

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However, the average house price in London remained the most expensive of any region, rising to £496,000.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “The housing market continued to be buoyant in February, with annual growth picking up.

“The launch of the mortgage guarantee scheme backed by the government will provide a further boost for the market, enabling those with modest deposits to get on the housing ladder sooner rather than later.

“However, while a growing number of lenders are offering 95 per cent mortgages, with pricing hovering around the 4 per cent mark, it is a classic case of the ‘haves and have nots’ as pricing on lower loan-to-value mortgages continues to edge downwards.”

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Nicky Stevenson, managing director at estate agent chain Fine & Country, said the property market remains “in a parallel universe at odds with the wider reality everyone has been living”.

“It’s been a gloom-defying 12 months given that last March, when the first lockdown arrived, the market seized up, mortgage products were withdrawn and everyone held their breath,” she said.

“Fast forward a year and you no longer need to be a mystic or expert to predict what comes next and that’s precisely the point. Confidence is king and there’s plenty of it out there. That would have remained true even if the stamp duty holiday had ended. Now that it hasn’t, that’s just more fuel on the fire but it’s impact has been overstated all along.”

By Jessica Clark

Source: City AM

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House prices increased 7.5% in the year to January 2021

Average UK house prices increased by 7.5% in the year to January 2021, according to the latest House Price Index by the Office for National Statistics (ONS).

Prices rose by the greatest margin in Wales, increasing by 9.6% to £179,000, this was followed by England, where prices rose by 7.5% to £267,000.

Prices in Scotland increased by 6.9% to £164,000, and in Northern Ireland to £148,000, up 5.3%.

The North West was the English region, which saw the highest annual growth in average house prices up 12.0%.

In contrast, the West Midlands noted the lowest at 4.7%.

Tahir Farooqui, chief executive of Canopy, said: “With a further increase to house prices comes an even bigger gap between hopeful first-time buyers and their new home.

“While the government is promoting a range of incentives such as 95% mortgages and a tapered end to the stamp duty holiday, it’s not addressing the true problem.

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“House prices are too high and securing an affordable mortgage is a pipe-dream for many.

“One way to put to good use the £64,000 of rental payments that the average tenant spends before buying their first home, is rent tracking.

“This means each monthly payment builds up their credit score, ensuring they have better access to financial products when the time comes to secure a mortgage. A strong credit score is a foundation for financial freedom.”

Rich Horner, head of individual protection at MetLife, added: “The market is finally breathing a sigh of relief with today’s data showing strong house price growth, that will only continue to be fuelled by the Chancellor’s move to extend the stamp duty holiday.

“For the next few months, at least, buyers will be encouraged to continue their property search and make moves before June.

“There still remains an element of worry around what the second half of the year looks like as the property market, and society more broadly, returns to a level of normality after more than a year of lockdown.

“But pent up demand and a supply shortfall will work in the favour of sellers to buoy property prices.

“However, at the lower end of the market a level of reservation could move in. For a significant number the events of the past 12 months have left them in an ambiguous financial position.”

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Miles Robinson, head of mortgages at Trussle, said: “Despite a slight fall in house prices month-on-month from December 2020 to January 2021, it’s important to note that house prices are still significantly higher than the same period last year.

“Traditionally, the property market is quieter at the beginning of the year and it’s Spring that tends to spark a change in buyer momentum.

“However, buyer demand has remained strong throughout 2021.

“At Trussle we saw a 15% increase in mortgage applications in January and a 17% increase in February, when comparing the same periods year-on year.

“The recent Budget announcement confirming an extension to the stamp duty holiday, as well as a 95% mortgage guarantee scheme is likely to continue to boost buyer demand.

“This in turn could elevate house prices even further.”

By Jake Carter

Source: Mortgage Introducer

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The Budget stimulated an 80% rise in buyer demand

The recent Budget stimulated an 80% rise in buyer demand for property compared to the four-year average, according to Zoopla’s monthly House Price Index.

Despite this, the supply of new homes is down 13%, compared to the 2020 average.

Zoopla outlined that the volume of homes for sale is expected to recover as the COVID-19 vaccination programme continues to gather pace and the Prime Minister’s roadmap out of lockdown comes into effect.

From a national perspective, average home values are up 4.1% since the start of the first lockdown, amounting to £8,907 on the year or £750 per month.

While annual house price growth is down slightly from 4.4% last month, this marks the fourth consecutive month of house price growth over 4%.

Regionally house price growth in the Midlands, North of England, Wales and Scotland are at an almost 10-year high, fuelled by the relative affordability in these markets.

At a city level, Liverpool and Manchester continue to show the strongest levels of annual house price growth, up 6.6% and 6.4% respectively.

Sales agreed are up 5.3% compared to the same period in 2020, and the average time to sell a property in the UK has fallen by nearly a week across the UK excluding London, down from 50 days in 2020 to 44 days.

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In contrast, London is the only region in the UK where properties are taking longer to sell.

The North East and the North West have recorded the highest reduction in time to sell on a regional level, falling by 17 days and 12 days, respectively.

At the same time, the North West and Yorkshire and the Humber are the fastest moving markets in the UK, with sales agreed on properties in an average of just 38 days from the point of listing.

The index also revealed that houses are selling three weeks faster than flats.

The lockdown-led ‘search for space’ means houses are taking an average of 42 days to go from the point of listing to sale agreed, this compares to 62 days for a flat.

Demand for three-bed homes rose by 30% in the week after the Budget, in relation, the average value of a house has risen by 4.9%.

Meanwhile, the average price of a flat has increased by 1.9% over the same timeframe.

An estimated 130,000 properties for sale in England will be stamp duty free for another six months following the Budget which will amount to £123m saved in tax.

Overall, Zoopla anticipates that more than half a million buyers this year will benefit from some level of stamp duty relief.

David Ross, managing director of Hometrack, said: “The 95% LTV mortgage guarantee scheme and the stamp duty extension outlined in the Budget have led to a spike in buyer demand, which was up 24% in the days following the announcement.

“The stimulus provided by the mortgage guarantee scheme will likely promote a similar increase of uptake of higher equity loans from the knock-on in demand up the property chain.

“With time to complete standing at around four months, buyers in the North of England look set to benefit the most – with two-third of local stock under £250,000 in value, and therefore always exempt from stamp duty.

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“While prospects for the wider housing market have improved on the back of the Budget, the post-lockdown path to the full reopening of the economy and unwinding of support measures will still have a big impact.

“Therefore, we still expect house price growth to moderate later in the year, but overall transactions look set to get an additional boost from the stamp duty measures.”

Nigel Purves, chief executive of Wayhome, added: “With a full year of lockdown behind us, there has been increased momentum in the housing market ahead of the busy Spring period.

“Indeed, house prices were up by 4.9% year on year and flats were also up by 1.9% over the same period.

“Over the coming months with offices, shops and restaurants set to reopen, we may witness some individuals turning back to connectivity and convenience, while others continue their ‘search for space.

“While the introduction of 95% loan-to-value mortgages may bring hope to those wanting to step foot on the ladder, affordability remains a serious problem.

“There are many households whose incomes still won’t meet the criteria for mortgage approval, despite their ability to consistently pay rent on the kind of homes they would like to buy.

“Going forward, the government needs to work with the property industry to better support alternative routes to help ‘reluctant renters’ achieve homeownership.”

By Jake Carter

Source: Mortgage Introducer

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Average house prices up 8.7% in England and Wales

Average house prices increased by 8.7% across England and Wales in the year to January 2021, according to e.surv Chartered Surveyors’ House Price Index.

On a monthly basis, average house prices rose by 1.2% between between December 2020 and January 2021.

Overall, the average price of a house in England and Wales was £330,958 at the end of January.

Richard Sexton, director at e.surv, said: “2020 proved an exceptional year in almost every way and many of the changes it ushered in won’t be easily swept aside.

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“Indeed, our data shows that the remarkable growth in property prices we saw in the second half of last year has continued into 2021.

“Rapid growth in the South West, East Midlands and the North West means that average property prices have started the year up close to 9% on January 2020.

“There are, as always, a number of factors at play, but we may well have moved beyond the release of the demand that was pent-up at the start of 2020 and into a new phase for the market.

“For many, the pandemic has proved very financially trying, but this hasn’t been universal. For some households, where people have kept their jobs and transitioned totally to home-working, the pandemic has provided an opportunity to cut spending and build their savings.

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“For these consumers in a more fortunate financial position, the combination of low mortgage rates and the stamp duty holiday have made entering (or often re-entering) the property market an attractive prospect.

“Many buyers have made the decision to make a move in the last year and the popularity of larger properties with more outdoor space has increased greatly, as buyers have reevaluated their current living situation.

“That activity in the property market has been able to continue at all over the last year, is due in a large part to the industry’s willingness to embrace technology and work innovatively.

“From remote valuations to virtual house viewings, the industry has shown that it is able to adapt and change to meet extraordinary circumstances – a positive sign for the future.”

By Jake Carter

Source: Mortgage Introducer

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