NOV EMBER 2023
£840,000
£1,258,671
-0.8%
£675
£41.4bn
18,226
MORTGAGE APPROVALS (SEP)
43,328
-10.9%
-32.5%
RESIDENTIAL TRANSACTIONS (SEP)
85,610
3.0%
-17.0%
GROSS MORTGAGE LENDING (SEP)
£18.6bn
2.2%
-28.7%
60,988
2.8%
-5.7%
244,830
-
-4.3%
NEW HOMES BUILT (Q323) NEW HOMES BUILT (ANNUAL)
SET TLING DOWN
We are entering a calmer, more settled landscape in the final months of the year. The market remains resilient, with transactions holding steady, supported by committed movers and realistic pricing. PRICE IT RIGHT
GREEN SHOOTS
House prices rose 0.9% in October, the largest monthly rise in over a year (Nationwide). The market is holding steady, underpinned by realistic pricing and motivated movers. Pricing sensibly remains key, as purchasers are cautious not to overpay; 37% of properties since the start of the year have had their asking price reduced (Rightmove). Good quality stock in sought-after locations continues to attract strong interest and the average price of a prime property is £1,258,671. On an annual basis there has been a slight softening of 0.8%.
Although demand is subdued, some green shoots have been appearing. Competition in the mortgage market is growing and consumer confidence, albeit negative, has reached its highest reading since January 2022 (GfK Consumer Confidence Tracker). Stock levels are showing signs of improvement, with supply above £1 million rising by 9% in the last year, although this remains below pre-pandemic levels (TwentyCi). Despite facing significant challenges the property market remains resilient, as demonstrated by relatively small price falls. Larger house price falls have been protected by low unemployment, growing incomes and a small but positive growth in the economy. Mortgage lenders are assisting customers with refinancing, limiting the number of forced sellers.
HOLDING STEADY With unemployment figures and inflation remaining the same, and the bank rate being held once again at 5.25%, we appear to be entering calmer territory. Although down on last year’s levels, transactions have been stable since June this year (HMRC). The Royal Institution of Chartered Surveyors’ measure of home buyer demand is down on last year but has improved since August. Mortgage approvals, an indicator of future demand, dropped to 43,300 in September, below the long-term average. This is however a 9% improvement on the start of the year (Bank of England). Although activity from mortgaged buyers is down, the number of cash buyers is steady and this is set to be the second largest buyer group this year, after first-time buyers. In 2023 cash buyers have accounted for one in three sales, compared to an average of one in five over the last five years (Zoopla). Looking to next year, with interest rates likely to fall and inflation tracking to reach its target of 2% in the first half of 2025 (Bank of England), market momentum should gather pace. Combined with pent-up demand and the usual uplift of buyer demand in spring, activity should improve.
AUTUMN STATEMENT All eyes will be on the government’s upcoming Autumn Statement to provide a clearer indication on the outlook for the UK economy. The government is reportedly considering an inheritance tax cut, with the potential to abolish it in the future, both welcome news for homeowners. Currently inheritance tax is charged at 40% for estates worth over £325,000, with an extra £175,000 allowance towards a main residence if it is passed onto children or grandchildren. Married couples are able to share the allowance, meaning that parents can pass up to £1 million to their children with no tax to pay. With rising house prices over the long term, a greater proportion of people are being drawn into paying the tax.
£410,000 £551,376 +1.2% £292
£520,000 £722,455 +3.9% £374
£593,000 £785,791 +3.3% £391
£540,000 £705,273 +3.8% £348
£486,000 £637,830 +0.7% £338
£775,000 £1,057,277 +1.1% £507
£510,000 £692,661 +3.9% £353
£836,000 £1,157,241 +2.4% £552 £1,000,000 £1,453,036 +0.4% £610
£1,670,000 £2,738,147 -6.3% £1,312
12% 10% 8% 6% 4% 2% 0% -2% -4% OCT 2022
NOV 2022
DEC 2022
JAN 2023
FEB 2023
MAR 2023
APR 2023
MAY 2023
JUN 2023
JUL 2023
AUG 2023
SEP 2023
£1,200 £1,050
£ 1,094
£900 £750
£ 753 £600
£ 632
£450
£ 675 £ 594
£300 £150 £0 DETACHED
SEMI-DETACHED
TERRACED
FLAT/APARTMENT
ALL PROPERTY
0% -5% -10% -15% -20% -25% -30% -35% -40% SEP 2022
OCT 2022
NOV 2022
DEC 2022
JAN 2023
FEB 2023
MAR 2023
APR 2023
MAY 2023
JUN 2023
JUL 2023
AUG 2023
£272,870 £840,000 £1,258,671
£226,125 £733,000 £1,171,182
£216,690 £683,000 £1,074,343
£270,497 £681,000 £953,341
£453,033 £1,200,000 £1,715,269
£284,595 £855,000 £1,274,610
9.6% 8.4% 7.2% 6% 4.8% 3.6% 2.4% 1.2% 0% OCT 2022
NOV 2022
DEC 2022
JAN 2023
FEB 2023
MAR 2023
APR 2023
MAY 2023
JUN 2023
JUL 2023
AUG 2023
SEP 2023
£400 £350 £300
£ 348
£ 348 £ 295
£ 288
£250
£ 246
£200 £150 £100 £50 £0 DETACHED
SEMI-DETACHED
TERRACED
FLAT/APARTMENT
ALL PROPERTY
64
62
60
57
56
55
55
55
55
55
57
59
52
52 48
45
44
40
40 36
37
32 SEP 2022
OCT 2022
NOV 2022
DEC 2022
JAN 2023
FEB 2023
MAR 2023
APR 2023
MAY 2023
JUN 2023
JUL 2023
AUG 2023
SEPT 2023
SEP 2022
OCT 2022
NOV 2022
DEC 2022
JAN 2023
FEB 2023
MAR 2023
APR 2023
MAY 2023
JUN 2023
JUL 2023
AUG 2023
SEP 2023
40 35 30 25 20 15 10 5 0
2023-11-02