5.8% annual house price growth at 5 year high

by Property118.com News Team

9:30 AM, 30th October 2020
About 4 weeks ago

5.8% annual house price growth at 5 year high

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5.8% annual house price growth at 5 year high

The Nationwide House Price index just released for October is showing annual house price growth rising to 5.8%, the highest rate since January 2015.

House prices on a month-on-month basis, after taking account of seasonal factors are up 0.8%.

Robert Gardner, Nationwide’s Chief Economist, said: “Annual house price growth rose to 5.8%in October–its highest level since January 2015. UK house prices rose 0.8%month-on-month in October after taking account of seasonal effects, following a 0.9% rise in September.

“Data suggests that the economic recovery has lost momentum in recent months with economic growth slowing sharply to 2.1% in August, down from 6.4% in July, despite a strong boost to the hospitality sector from the Eat Out to Help Out scheme, which has since expired.

“Labour market conditions also weakened with the unemployment rate rising to 4.5% in the three months to August –still low by historic standards, but up from an average of 3.8% in 2019.

“Nevertheless, housing market activity has remained robust. Mortgage approvals for house purchase climbed to 91,500in September–the highest level since 2007.

“The outlook remains highly uncertain and will depend heavily on how the pandemic and the measures to contain it evolve as well as the efficacy of policy measures implemented to limit the damage to the wider economy. Behavioural shifts as a result of Covid-19 may provide support for housing market activity, while the stamp duty holiday will continue to provide a near term boost by bringing purchases forward.

“However, activity is likely to slow in the coming quarters, perhaps sharply, if the labour market weakens as most analysts expect, especially once the stamp duty holiday expires at the end of March.”


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Comments

Neil Patterson

9:46 AM, 30th October 2020
About 4 weeks ago

Comment from Iain McKenzie, CEO of The Guild of Property Professionals:

"Demand in the market is still pushing property prices up, with the Nationwide House Price Index data reporting that annual house growth reached a five-year high in October. While this time of year is traditionally when we would see transactions slow down, the property market remains robust and continues to move forward fuelled by people’s desire to gain more space and live differently to what they have been.

High levels of market activity during Summer have carried over into the colder months, with the Autumn market remaining strong and positive during the first two months of the season. With the stamp duty deadline just five months away, transactions are likely to remain high as buyers push to take of advantage of the holiday, however, time is quickly running out.

The substantial transactions figures since the market reopened in May has caused delays in the conveyancing process. Added to that mortgage applications, surveys and local searches are all taking significantly longer too. According to Zoopla, only a quarter of transactions based on sales agreed in January will complete by March.

To increases their chances of making the deadline, people selling their properties should instruct a conveyancer at the time of first going to the market, to prepare a sale ready pack and getting the process moving along quickly as possible. "

steve watt

21:31 PM, 1st November 2020
About 3 weeks ago

3% knocked off SDLT until 31 March 2021, base rate reduced to 0.1%, pent up demand - these factors may have helped. Long-term direction = downward, in my view.


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