House price growth “eases” - Mortgages - News - Moneyfacts


House price growth “eases”

House price growth “eases”

Category: Mortgages

Updated: 06/10/2015
First Published: 06/10/2015

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

House prices only seem to be going one way at the moment, but happily, it doesn't look as though things are unsustainable. Prices may be rising but the pace of that growth is easing, with figures from Halifax showing that the rate of annual price inflation has slowed from last month, and on a monthly basis, prices have actually dropped.

The figures show that, in the three months to September, prices were 8.6% higher than they were in the same period a year earlier. It's still a notable increase, but it's lower than the rate of annual growth recorded last month (9%), while on a quarterly basis prices have only grown by 2%, down from last month's 3% and the lowest recorded since May.

Not only that, but prices have actually fallen by 0.9% from August, with the price of a typical UK property now standing at £202,859, down from £204,722. This is a dramatic change from the monthly increase of 2.7% recorded the previous month, which provides further evidence that prices are moderating.

The question is, will it last? Demand is still strong, while supply of suitable homes for sale remains at record low levels, which could continue to put upwards pressure on prices. Some types of home could be even more susceptible to these kinds of increases – flat prices, for example, have risen the most in recent years, with Halifax's figures showing that the price of an average flat has rocketed by 60% in the last decade, compared with 38% for all residential properties.

Activity in the housing market overall remains strong, with both mortgage approvals and house sales rising, which all adds up to a healthy market. It's therefore unlikely that prices will fall significantly in the near-future – as Martin Ellis, Halifax housing economist, says, "there is little reason to expect any fundamental shift in the key market drivers over the coming months" – but it's hoped that they won't rise too excessively, either.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

85% of remortgagors benefit from lower rates

Mortgage rates are among the lowest ever recorded, and in the case of fixed rates, they just keep falling! This means it’s never been cheaper to fix your mortgage rate for the long term, and unsurprisingly, remortgagors are taking advantage.

Does your mortgage lender owe you money?

Earlier this week, the financial watchdog revealed that hundreds of thousands of mortgage holders could have been overcharged by their lender. Are you one of the many who could be in line for a windfall?

Do you think your home will rise in value?

There’s been a lot of talk recently about the rate of house price growth slowing, but is it affecting your personal expectations? According to research, it could be, with fewer people now expecting the value of their property to increase.