The upward trending property market continues with house prices remaining higher than the start of the year. During September the property market took a slight upturn of 0.8%, it has been viewed as a very positive start to Autumn as this monthly rise is twice what is expected for this time of year when looking at historical data. The headline news is that estate agents currently have the most amount of inventory to sell since 2014, there is also 15% more buyers and 27% more sales than the same time last year. 

Since cutting the base rate by 0.25% during August the base rate still remains at 5%. In anticipation of rates coming down, during July some lenders had already started to lower their rates. Coventry building Society, now offer the cheapest mortgage rate of 3.69% on a 60% LTV. The average mortgage rate for a five year fixed term is 5.09% which is still higher than the mortgage rate of a couple of years ago. If mortgage rates continue to fall it will make buying a house more accessible for many, in theory this should get the property market moving faster.

Certain costs for homeowners may still hold the market back, inflation at the shops and higher energy bills have caused a cost of living crisis. Inflation is now at 3.1% for August this is significantly lower than the peak of 9.6% that was seen in 2022. The lower rate of inflation has now transferred into more consumer spending at the shops with August having the first positive month of growth since March with an increase in consumer spending of 1%. One month on consumer spending increased by 1.1% for September. There is still the cost of living crisis that includes increased energy costs, council tax and other bills that is giving less disposable income for potential property buyers.

What Are the Current House Price Figures?

In the UK there are various different sources that analyse the market and produce average house price figures with differing results so here’s a look at what each index has reported:

Halifax

The Halifax House Price Index reported in September shows that house prices by 0.3%.  According to Halifax the average house price now stands at £293,399. This represents a monthly rise of 0.3% and a year on year price rise of 4.7%. even though house prices are up interestingly the average price paid by first time buyers is around £1000 less than what they were prepared to pay two years ago. First time buyers don’t have any equity to help them buy a house so it is evident that they have less money to spend nowadays than previously. The Halifax national house price can seen in the chart below:

Halifax House Price Index Sept 2024

Nationwide

The Nationwide House Price index for September shows a monthly increase of 0.7% and an annual increase of 3.2%. The commentary has said that the “rate of growth rising from 2.4% in August to 3.2% in September is the fastest pace since November 2022”. The report for September 2024 shows that the national house price is £266,094.

Nationwide House Price Index Sept

Zoopla

Similar to Rightmove, Zoopla record advertised “For Sale” prices so they are always more optimistic than Land Registry results and prices that are reported by mortgage lenders. Zoopla are reporting that house prices are almost 1% higher than last year. According to Zoopla the average house price currently stands at £267,100 as of August. Zoopla predict that the property market will be very buoyant for the last quarter and that house prices will rise by 2.5% by the end of the year.

Zoopla House Price Index October

Rightmove

House Prices on Rightmove are based on asking prices and the UK average now stands at £370,759, a increase of £2974 from the figures reported previously. This is an increase which is twice as much as expected for the same time of year and is seen as positive start for the final quarter of the year. The full report for September can be seen here.

Office of National Statistics

The Office of National Statistics now reports data in a report that is called Private Rent and House Prices. The data for September shows that over the past year the national house price has increased 2.2% and now stands at £290,000. 

Should You Buy a House in 2024 or Wait?

This general consensus from analysts is that house prices will moderately fall during 2024 but so far according to Zoopla house prices are already up by almost 1%. Furthermore, Halifax are showing a increase of 4.7% since the same time last year and if house prices remain largely positive for the rest of the year then it looks like that the analysts will be proven wrong. Similarly, dramatic predictions of house prices falling between 5% and 10% during 2023 didn’t materialise and house prices are now higher than they were before. 

It’s understandable why analysts still have a negative outlook. Interest rates are still high and there is still a cost of living crisis, where household bills and expenditure have been pushed up by the inflation that we have experienced in the past year. However, the housing market has remained resilient and in our opinion prices have already bottomed out during January 2024. Furthermore, if interest rates fall further and mortgage rates become lower and buying a house becomes more affordable, then many more buyers will enter the market and push prices up.

Here are some of the the predictions of how far house prices could rise or fall during 2024:

Inflation at the Shops May Cause House Prices to Rise

It should also be noted that the value of the pound has now changed, prices at the shops have increased by around 25% since April 2022. Prices are now rising more in line with the target rate of inflation but this doesn’t mean that they are falling they are just rising less quickly and are still inflated due to what happened to prices in 2022.

At some point in the future there will be a recovery and you would expect a rise in house prices that will be associated with the rise that we have seen with the prices of our goods, bills and increased wages.