UK house market shows further signs of stabilising
By Abigail Townsend
Date: Wednesday 20 Mar 2024
(Sharecast News) - UK house prices dipped only marginally in January, official data showed on Wednesday, providing more hope that the market was stabilising.
According to the latest provisional UK house price index from the HM Land Registry, average UK house price inflation was -0.6% in the year to January. Although still in negative territory, it was a marked improvement on December's revised 2.2% fall.
The average UK house price was £282,000 in January, £2,000 lower than the same month a year previously.
Month-on-month, prices edged up 0.5% to £281,913.
HM Land Registry flagged the Royal Institution of Chartered Surveyors' most recent UK Residential Market Survey, which noted increases in both buyer demand and new instructions.
It also pointed to the Bank of England's latest Agents summary of business conditions, which attributed a gradual improvement in the market to the continued easing in mortgage interest rates.
Mortgage approvals - an indicator of future borrowing - also jumped in January.
The UK housing market was hit hard by surging inflation, higher interest rates, constrained demand and the cost of living crisis.
It then suffered a further blow after the government's disastrous mini budget in September 2022 sent mortgage rates soaring.
However, while affordability remains an issue for many, mortgage rates have started to moderate while data released on Wednesday showed inflation had receded to 3.4%, its lowest level since 2021.
Most market watchers now expect the BoE to start cutting the cost of borrowing this year.
Stephen Perkins, managing director at Yellow Brick Mortgages, said: "This data has a lag of several months or so, but is starting to show signs of life in the property market.
"After positive inflation news this morning, a first base rate cut may not be too far off, and that could inject some much-needed momentum into the market."
The UK HPI is calculated by the Office for National Statistics based on data from HM Land Registry, Registers of Scotland, The Land & Property Services/Northern Ireland Statistics & Research Agency and the Valuation Office Agency.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN