Speculation on the future course of interest rates was rife this week after inflation rose by 4.6% in the 12 months to October 2023, down from 6.7% in September. Asking prices slip in time for Christmas, as realism kicks in. Meanwhile, the renters reform bill is put before the committee and Rachel Maclean is replaced as housing minister for Lee Rowley. Welcome to another UK Property News Recap.

Rightmove HPI – November 2023

According to the property portal Rightmove. Fleeting listing optimism in October was quickly replaced with realism in November. Asking prices fell -1.7% (-£6,088) to £362,143 in November 2023, the largest fall for the time of year in 5 years. Properties at the top of the ladder falling further and selling for less than those on the lower rungs.

 

 

Reportedly average ASKING PRICES were down only 3% on May’s peak, but the agreed price is likely to fluctuate depending on the property and location. Annual prices in the Midlands and all Southern regions showing larger falls than in Wales, Scotland and the North of England.

 

Mortgage rate speculation 

Before the ONS could release its October Consumer price index results, the consensus was inflation was on the turn. This was due to an expected fall this month in the energy price cap, which limits what suppliers can charge consumers per unit of energy. CPI results didn’t disappoint, inflation was down to 4.6% with many divisions reducing. However, the outlier, occupier’s housing costs, continued to rise.

 

   

Getting in its press release early was Morgan Stanley who forecast policymakers will reduce rates to 4.25% by the end of 2024. The Investment bank however was keen to point out that the UK would experience a technical recession, with the economy shrinking by 0.1% in 2024 before growing by 1% in 2025.

However others, post CPI release, projected the first base rate cut in May 2024.

 

Our seasonally adjusted version of the U.K.'s core CPI has risen at an annualised month-to-month rate of just 2.2% over the last three months. PPI data suggest this slowdown can be broadly maintained. The route to the first Bank Rate cut next spring is now very clear to see. pic.twitter.com/fCEN2Uj169

— Samuel Tombs (@samueltombs) November 15, 2023

 

And lenders, in response to inflation falling, keen to make their end of year targets, further trimmed their prices, hoping to entice buyers. 

ONS House Price Index for September 2023

For the first time since 2012, the ONS HPI reported a fall in average house prices in September 2023. This was largely driven by price reductions in England and Wales, reducing the average house price in the UK by -0.1% in the 12 months to September 2023.

Annually, prices in England fell -0.5%. Increasing 2.5% in Scotland and decreasing -2.7% in Wales. Whilst Northern Ireland increased 2.1% over the year to Q3. Making the average UK house price, £291,000.

 

For renters there was further bad news in the ONS index of Private Housing Rental Prices for October 2023.

Private rental prices increasing 6.1% in the 12 months to October 2023. 6.0% in England, 6.9% in Wales, & 6.2% in Scotland. In the Capital prices increased 6.8% annually, further driving renters into the suburbs or back home.

 

Another month another housing minister – Lee Rowley replaces Rachel Maclean

 

 

Lee Rowley becomes the 16th housing minister since 2010 to take on housing under Michael Gove. The decision to shuffle Rachel Maclean out the revolving door, a day before she was due to  introduce the Renters Reform Bill to Committee, is frankly lunacy. Given housing is such a political, vote winning, issue;  it’s amazing the Government doesn’t realise how this looks to the general public who don’t want ministers to get up to speed. They want the job done. 

 

Changes to the Renters (Reform) Bill 

Now at the committee stage, the changes  to the renters reform bill being considered for the Bill in the House of Commons include:

Making it illegal for Landlords to refuse tenants who receive benefits or who have children. 

A Decent Homes Standard to be applied. This will give Local Authorities enforcement powers to require landlords to make properties decent, warm and safe. If landlords do not comply, they will have the authority to fine landlords up to £30,000 or apply a banning order in the worst cases. Tenants will also be able to claim up to 24 months rent back through rent repayment orders up from 12 previously. 

 

And that concludes another UK Property News Recap.

 

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