Promising news for sellers and buyers: House price growth at near two-year high

[Susanap]

This is the news sellers have been waiting for at last! If things continue on this upward trend, the market will see improvements by spring. 👏 This confirms the market has now bottomed out and is slowly on its way up.

‘’BBC news today: House price growth at near two-year high
UK house prices in September rose by 3.2% compared with a year ago - the fastest rate for nearly two years, according to Nationwide.
The building society said that annual growth was the highest since November 2022, with terraced homes driving the increase.
It said rising incomes and mortgage rate cuts were improving affordability for buyers. Separate data from the Bank of England also showed mortgage approvals at their highest level for two years.

House prices have been relatively stagnant in the last year, as activity in the UK housing market has been limited.
But many commentators suggest, with interest rates expected to fall, demand from buyers could now pick up’’

Hang in there sellers and good luck with your house sales 😊🙌

The housing market is a curious thing, whereby when the product that buyers wish to purchase becomes more expensive, it is celebrated as good news!

Hmm all I'm seeing is reductions still in my area

There are winners and losers whatever the market does.

It is good news for sellers as @Susanap notes but not such good news for buyers. Still, it's what the housing market does. It's been stagnant for a while now but was never likely to stay that way indefinitely.

Nope! I doubt very much this is a thing. And definitely isn’t going to be before the budget!

Same

Nationwide house price index: September records fastest annual house price growth in two years.
Commenting on the figures, Robert Gardner, Nationwide's Chief Economist said "UK house prices increased by 0.7% in September, after taking account of seasonal effects. This resulted in the annual rate of growth rising from 2.4% in August to 3.2% in September, the fastest pace since November 2022 (4.4%). Average prices are now around 2% below the all-time highs recorded in summer 2022.
“Northern Ireland remained the best performer by some margin, with prices up 8.6% compared with Q3 2023. Scotland saw a noticeable acceleration in annual growth to 4.3% (from 1.4% in Q2), while Wales saw a more modest 2.5% year-on-year rise (from 1.4% the previous quarter).
“Across England overall, prices were up 1.9% compared with Q3 2023. Northern England (comprising North, North West, Yorkshire & The Humber, East Midlands and West Midlands), continued to outperform southern England, with prices up 3.1% year-on-year. The North West was the best performing English region, with prices up 5.0% year-on-year.
“Southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) saw a 1.3% year-on-year rise. London remained the best performing southern region with annual price growth of 2.0%. East Anglia was the only UK region to record an annual price fall, with prices down 0.8% year-on-year".
https://www.nationwidehousepriceindex.co.uk/reports/september-records-fastest-annual-house-price-growth-in-two-years

Big regional variations as noted in the Nationwide House Price Index posted above.

Having to pay a large part of your salary for a home, be it mortgage or rents ( which go up with house prices ) is why so many people are suffering CoL

Why on earth are you happy that prices are rising?

The only people who benefit are "downsizers" who take their city mega bucks and use it to force out locals from more rural areas

Most sellers become buyers so works in roundabouts. So it’s ok for sellers to lose money and end up possibly in negative equity so buyers can gain from their loss?

The only people this is good news for are bankers. Everyone else will just have to borrow more and pay more in interest

I think you're reading a bit too much in to my comment!

Interesting that you are concerned about negative equity, I wonder why you think that many people are on high LTV% mortgages?

I don't agree with that.

If I was downsizing right now I would be happy to get 2% more for my house say and then pay 2% more for the cheaper house I was buying.

Or if I was inheriting a property I would be happy to get a bit more money for it.

Mainly it's just a sign that the housing market is more resilient than many people thought and hasn't collapsed despite a cost of living crisis and interest rates that rose at a faster rate than most of us expected.

Every sellers situation is different and there are tons of sellers who may have purchased in the last 5 years at a high price who could end up in negative equity. Not all sellers are boomers sitting in million pound assets.

It's possible that the properties you're seeing reduced are people selling ex-rentals and second homes, desperately trying to exchange before 30 Oct and the predicted CGT hike!

Gotta love a bit of irresponsible reporting with almost sod all context.

>UK residential property transactions fell by 12% in the year to 30 June to 861,210, according to HMRC data – the lowest level in more than 10 years.

https://www.theguardian.com/money/2024/sep/30/number-of-uk-estate-agents-going-bust-rises-almost-a-third-in-one-year

>The number of UK estate agents declaring insolvency has jumped by almost a third with nearly 300 businesses going bust in the last year.

I do believe that some house prices are going up. Mainly terraced houses which are traditionally the cheapest and houses in areas that have been known to be cheap for a very long time. Their average prices are creeping up pdq.

There is almost certainly a rise in very sought after areas where people have been sat on the fence waiting for mortgage and inflation rates to come down or at least settle, which is now slowly happening.

Most other places, it seems to be people with quite expensive houses who are selling, which will push up the overall house price figure. Along with some pretty expensive new builds hitting the market - although I have no idea whether those are selling or not. Last time I looked at a few adverts they were throwing around incentives like crazy to try to get buyers in.

So, no, I don’t believe house prices as a general rule are increasing. I think there is a very certain subset of people moving house and other than the really expensive houses I sometimes see, hardly anything worth buying seems to be hitting the books, and I have seen many other MNers complain “there is nothing worth buying” over the last year.

Added to the above, there’s the recent quite shocking statistic* that 52% of homes listed are being removed from EAs books after a sale has completed and the other 48% are being taken OFF the market.

But in media and estate agent land, of course everything’s coming up smelling of roses O_O

*from the UK Property Market Stats show

Terrible news for estate agents though. Higher prices = less turnover = much less revenue. No wonder so many are going out of business.

Indeed. The successful business model for estate agency is based on turnover, not high prices

The BBC report was based on figures from the ONS.

I personally don’t want house prices to rise, I just don’t want a crash so thousands of homeowners are left in negative equity, plus a moving market is a sign the overall economy is recovering which we all should want. (apart from the selfish few who are waiting for a crash so they can bag a bargain at someone else’s misery)

It is just good news that the market is now moving again albeit at a slow pace.

The 48% of sellers you mention taking their houses OFF the market are the sensible sellers who don’t want to take a hit and will relist in spring at a higher price.

Agree that a small increase in house prices is not particularly helpful to EAs as turnover is more important to them than the actual price achieved.

The 48% of sellers you mention taking their houses OFF the market are the sensible sellers who don’t want to take a hit and will relist in spring at a higher price

I thought most sellers were also buyers, so they'll be paying more too?

Get 20k more for their house, spend 20k more on their next one.
In the meantime, won’t someone think of the Estate Agents!

They are but people aren't always logical when it comes to selling their properties. In actual fact they would be better off selling when prices are low if they are also upsizing but some people don't seem to appreciate that.

>The 48% of sellers you mention taking their houses OFF the market are the sensible sellers who don’t want to take a hit and will relist in spring at a higher price.

What makes you think they are sensible and they will get more money in Spring?

I have seen quite a few properties sell for 2021 prices this year after being reduced many times. What is the magic bullet that will make people want to spend more in 2025? The economy isn’t getting any better, everything is still cripplingly expensive, and next year food prices will probably rocket when local governments pass back recycling costs to manufacturers. The recent minimum wage increase is yet to hit full effect in terms of knock on effect to the service industry, and when I count the number of friends I know who went away for an overseas holiday this year, it’s on one hand.

I also don’t like the idea of people losing lots of money on their houses - the biggest problems have always been wages not rising to keep up with inflation and dumb government interventions artificially stimulating the housing market.

I am not trying to be facetious - if there are reasons you think people will sell more houses in Spring next year I would really like to know. Because I really don’t think an extra 0.5% off mortgage rates if the BoE drop the base rate three times is enough to do it.

KievLoverTwo

I do not have a crystal ball so this is just my opinion, I don’t know what will happen but here are some points I believe will stimulate the market and I mention Spring as this is the busiest time to sell.

* Labour will not extend the stamp duty relief in March which is enticing buyers to purchase before this sets in.

*If Labour offer more help to first time buyers in the budget this will encourage more people to buy.

*The rental market is on its knees. Landlords are selling up to avoid the CGT increase in October so there are less properties to rent.

*The higher cost of renting due to lack of availability and compared to a much lower monthly mortgage fee will entice people to buy and gain an asset in the process.

*The 20% VAT on private schools will encourage parents to move close to good state and grammar schools (increasing house prices in these locations) and the ones who keep their children in private may sell to release equity to fund the fees and move to a less expensive home (increasing sales in mid range house prices)

*Interest rates will drop next year possibly by another percent.

*Mortgages are already cheaper now and banks are starting to offer better deals.

*If properties start to go under offer, which they have started to more than last month, whether lower in price or not, buyers will notice this and gain confidence which will stimulate the market.

*There aren’t enough properties in the uk to go round.

*As long as the market stabilises and people start buying again the prices will remain at the level they are now or possibly increase.

*The latest BBC news today and other news will give buyers more confidence.

All of the above, I believe, will stimulate the market.

I totally agree with your post! Why on earth do we want higher house prices!!!