Industry reacts to latest Gov HousePrice Index
The latest index shows that: –
- The average monthly rate of house price growth in May rebounded to 1.1% following the -2.7% decline seen in between March and April.
- The average annual rate of house price growth in May was up 3.9%.
- As a result, the average UK house price is now £269,000.
Colleen Babcock, Rightmove’s property expert says:
‘May was the busiest month for agreed property sales since 2022, as the market bounced back from a temporary lull post stamp duty increase. It’s a price-sensitive market right now, with a decade-high number of homes for sale for buyers to choose from.”
Rightmove’s mortgage expert Matt Smith adds:
“A slightly higher than expected inflation figure this morning, but we’re still on track for inflation to peak this summer before falling back as the Bank expects. The average two-year mortgage rate is now 4.53%, a significant drop from 5.34% last year, with hopefully two more Bank Rate cuts still to come, which could help to drive rates down further.”
Director of Benham and Reeves, Marc von Grundherr, commented:
“The latest sold price data show that the monthly rate of house price growth bounced back in May, following a brief period of decline in the wake of the recent stamp duty deadline.
This demonstrates that the appetite of the nation’s homebuyers is yet to diminish and they remain motivated to push on with their plans to purchase despite the higher cost of stamp duty when doing so.
At the same time, the market continues to demonstrate stability and resilience on an annual basis, with house prices remaining higher than they were this time last year, despite the strengthening economic headwinds that we’ve had to contend with.”
CEO of Yopa, Verona Frankish, commented:
“The latest house price figures for May demonstrate a market that is very much on the front foot and ready to build on the momentum gained in recent months, particularly now that the distraction of another stamp duty deadline is behind us.
This underlying resilience provides a solid platform for future growth, which will only be strengthened by the announcement this week of the Government’s mortgage market reforms.
By easing mortgage lending criteria, these changes will broaden access to finance, helping to attract more buyers into the market and support continued house price growth over the remainder of the year and beyond.”
Nathan Emerson, CEO of Propertymark, comments:
“In some respects, rising house prices shows as an indicator of growth in the general housing market and stability in some people’s finances as some banks are now cutting their mortgage rates to further stimulate the housing market. However, there is still more work to do to boost Britain’s housing market and make homeownership a realistic aspiration for those looking to step onto the property ladder for the first time.
“There are many reports suggesting that the Stamp Duty hikes commencing from April this year are having a negative effect as some people are paying between £6,000-£12,000 more in charges, and there are even calls for more flexible Stamp Duty payment options too. Though this tax was increased to help balance the UK’s finances, other reports suggest these increases are deterring aspiring homeowners. The UK Government should listen to those working in the industry who are noticing the negative consequences this policy is having.”
Responding to rental prices, Nathan Emerson, CEO of Propertymark, comments:
“Investors in the private rental market have been deterred from investing in this crucial housing market because of tax and regulatory changes over the last ten years, and now recent reports suggest that they have been deterred further by Stamp Duty increases on second homes.
“Britain needs a stable and thriving private rental market to provide choice to people who intend to put a roof over their heads. New legislation especially in both England and Scotland is adding more uncertainty to aspiring investors and ultimately raising rent prices in the long term, creating a myriad of unintended consequences. It is vital that the UK Government and the devolved administrations listen to those working in the lettings market to ensure that the private rental sector works better for everyone.”
On Sales:
Jean Jameson, Chief Sales Officer at Foxtons, said:
“June was a steadier month in Sales as the market continued to adjust after a strong Q1. Consumer confidence is still on the weaker side, and with interest rates not coming down as quickly as many had hoped, activity hasn’t picked up as quickly as previously expected. Despite this, new instructions have continued to come to market, giving buyers more choice as we move into the summer.”
On Lettings:
Gareth Atkins, Managing Director of Lettings, said:
“The London lettings market showed strong signs of stability in June, with applicant numbers rising 21% from May and new listings at their strongest level in four years. This increase in supply is helping to ease pressure on renters, as seasonal demand increases, and with more applicants in the market, good Landlords will see strong demand across the capital. As we move into the summer, we expect this healthy balance between supply and demand to continue, offering more choice for renters and a stable and predictable environment for London’s landlords.”
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