This week Rightmove turned mystic and pollster, the ONS totted up household costs, whilst the Bank of England looked to the future as Halifax assessed the past. Welcome to another UK property News Recap.
Rightmove Property Forecast 2024
No week would be complete without a property forecast. This week Rightmove turned mystic predicting national ASKING prices will fall 1% in 2024 with local market variations. The overriding message being; if you want to sell – price it right the first time. “Testing” the market when it’s already stressed will only result in seller stress.
The ONS Household Costs Index
The ONS Household Costs Index showed that mortgage and other owner occupiers were feeling the inflation pitch more than others with increased mortgage payments at 9.3% in September 2023. Closely followed by social and other renters at 8.8%, outright owner occupiers at 7.4% and private renters at 7.2%.
Rightmove’s Happiest Place to Live 2023 Survey
Amazingly, 26,000 people took the time to fill out Rightmove’s survey which consisted of 13 questions based on happiness factors in their area. Despite being in the capital, Richmond came out on top, closely followed by Winchester. Overall though places close to nature trumped cities.
Unsurprisingly, around one in three (30%) residents think that they would be happier living in a different area….because the grass is always….
The Bank Of England Financial Stability Report – December 2023
On Wednesday the Bank of England produced its Financial stability report In this it revealed that around 45% of fixed-rate mortgage deals, which were agreed before the end of December 2021, are sitting on the periphery waiting for their mortgage renewal D-Day. As rates adjust throughout the coming years their mortgage payments are expected to be lower in future than they otherwise would’ve, post Truss and the summer of 2023. Importantly, despite just over 50% of borrowers being already exposed to increased rates, the overall share of households behind in paying their mortgage has only risen slightly.
Reading between the lines, traders decided to fully price in three rate cuts from the Bank of England next year. This helped put 10-year yields below 4% for the first time since May and gave hope to many movers, change was a foot.
Halifax HPI November 2023
According to Halifax, UK house prices appeared to tick up for a second month, increasing 0.5% in November 2023 making the average house price £283,615. Annually though prices dropped -1.0% with variations between regions and nations: Scotland & North Ireland remaining resilient whilst the South East fell -5.7% & -3.8% in London.
A lot of noise surrounds these property PR Indices. To clarify, no one should be taking them as gospel. They are just graphs based on one company’s data alone, in this case Halifax’s customers.
Leasehold reform – ground rent backlash
Ever wondered why ground rent hasn’t been abolished before now? It all comes down to what freeholders are set to lose. By turning off the ground rent tap, another turns on. Thirsty investor groups warn: Cap ground rents and expect compensation demands. “The RFA estimates that UK pension funds have more than £15bn invested in ground rents & the total value of investment in ground rents exceeds £30bn.”
Berkeley Interim Results
On Friday, developer Berkeley released their interim results. These showed future sales had taken a tumble as we head into the new year:
“The value of net reservations during the period is one 3rd lower than the comparative financial year, reflecting the sharp inc in interest rates and the ongoing elevated political and macro volatility.”
Interest rate Movement
To end the working week, Moneyfacts reported that lenders had decided to roll up their sleeves in the hope of attracting customers. The average 2 year fixed rate dropped below 6% for the first time since June this year. However in recent weeks some lenders, keen to win business over their competitors are offering sub-5%.
And that concludes another UK Property News Recap.
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