UK house prices edge up despite monthly seasonal dip – Nationwide

UK house prices edge up despite monthly seasonal dip – Nationwide

9:17 AM, 2nd April 2024, About 3 months ago

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The UK’s house prices rose by 1.6% in March compared to the same period last year, following a 1.2% growth in February, according to Nationwide.

This represents a modest increase but there was a 0.2% dip in prices on a monthly basis when adjusted for seasonal variations.

The lender’s chief economist, Robert Gardner, said: “Activity has picked up from the weak levels prevailing towards the end of 2023 but remain relatively subdued by historic standards.

“For example, the number of mortgages approved for house purchase in January was around 15% below pre-pandemic levels.

“This largely reflects the impact of higher interest rates on affordability.”

Buyer sentiment is improving

Mr Gardner says that buyer sentiment is improving as cost-of-living pressures ease and there’s been a rise in new buyer inquiries and instructions to sell.

He also adds that housing affordability is gradually improving due to income growth outpacing house price increases.

The future of house prices will largely depend on interest rate levels, he adds, but there is growing momentum in the market.

All regions saw prices rise with Northern Ireland leading the way with a 4.6% price rise, while the north of England emerged as the best performing English region with price growth of 4.1%.

Southern England, however, witnessed a slight year-on-year decline of 0.3% though London’s house prices rose by 1.6% but in the South West prices fell by 1.7%.

‘Property market has sprung into action’

Foxton’s chief executive, Guy Gittins, said: “The UK property market has well and truly sprung into action in recent months, and we’ve seen a notable uplift in the volume of sales enquiries, viewings requests and the number of offers being submitted.

“It’s fair to say that the green shoots of positivity seen since the closing stages of last year are blossoming and this is helping to cultivate positive house price growth.”

He adds: “Higher mortgage rates do remain a concern for many buyers and will continue to influence the price they are able to pay to a degree.

“However, with interest rates expected to fall this year, market confidence is high and we’re continuing to see buyers move forward with their plans to purchase undeterred.”

‘Property market has a slight spring in its step’

Sarah Coles, the head of personal finance at Hargreaves Lansdown, said: “The property market has a slight spring in its step, but it’s being weighed down by higher prices and unyielding mortgage rates, which meant house prices eased off in March.

“There’s still some buyer enthusiasm animating the market, and Zoopla figures last week showed sales up 9%. Much of the monthly fall is due to the seasonal adjustment rather than buyers driving a hard bargain.”

She added: “However, we’re still a long way from the kind of bounce sellers were hoping for in the spring. Mortgage approval levels are still around 15% lower than before the pandemic.

“When you consider how many new For Sale signs have been going up around the country, it means sellers may still struggle to shift their properties.

“Zoopla figures out last week showed that the stock of properties is up by a fifth, and they’re accepting an average discount of £10,000.”

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