EP138: What's really happening to UK house prices? We decipher the September data

EP138: What struck me this month in my discussion with Eyeedul is the continued strength of the rental market. Nationally rents increased 10.3% y/y while in London it's 13%. 

“It isn’t just tenants who are feeling the financial strains of increasing rental prices. The exacerbating economic issues around rental prices are also leaving landlords with increasing rent arrears, resulting in struggles to make mortgage payments and other expenses. It really is a vicious circle, with very few winners. We see no end to the madness, with rental supply coming under more pressure as Landlords try and exit the market.” Andy Halstead, CEO HomeLet & Let Alliance

I asked Eyeedul: "We are seeing again, the number of renters increasing dramatically. In August alone, there were 50,000 new tenancies added to the market. The number of renters chasing each home has jumped from 20 to 25 in the last five months according to Rightmove. In 2019 there were six phone calls or email requests per property and that rose to 20 by the spring of 2023 and now 25. We’ve got Andy Halstead, CEO of HomeLet & Let Alliance, saying that landlords are leaving the market and we've got an increase in demand with a decrease in supply but are we actually seeing any figures that support that landlord exit?" Take a listen and let me know what you think.

House prices: Nationwide, Halifax and Rightmove have reported a consistent message: -5.3%, -4.9% and -0.4% over the last 12 months. 

 ONS figures show increases of 0.6% nationally and -0.8% in London. This ONS data has a 3-month lag time, as it records the prices that properties actually sold for and is taken from data from the Land Registry. The rate of house price growth is levelling off, but certainly not in free-fall.

Interest rates: The Bank of England rates have remained at 5.25% which is very welcome news. Rates may plateau now, as they will not decrease until 2024 until inflation targets of 2% are met. 

 Mortgage rates: Lenders are continuing to be competitive as they are fighting for market share, and SWAP rates are decreasing which gives scope for reduction in rates.

My Property Consultant still forecasts UK house prices to level off for the remainder of 2023, which means that we are now in a buyers’ market. We cannot expect large discounts on properties, but there are certainly less people looking which makes it an ideal time to buy property. A softer market has been priced into the marketing prices, and properties which are keenly priced will sell.

Join us live every month as Eyeedul Haque of My Property Consultant and I crunch the data behind the UK house price headlines.