House Price Growth Remains Stable in June
According to Nationwide’s latest House Price Index, house prices grew by 1.5% in June compared to the same period last year. On a monthly basis, prices edged up by 0.2%, reaching an average of £266,064.
House prices remain stable in June
Regionally, Northern Ireland was the best-performing region, with prices up by 4.1% in Q2 alone. On the other end of the spectrum, East Anglia was the weakest-performing region, with prices down 1.8% over the year.
“UK house prices edged up by 0.2% in June, after taking account of seasonal effects,” said Robert Gardner, chief economist at Nationwide. “This resulted in the annual rate of growth rising from 1.3% in May to 1.5% in June, leaving prices around 3% below the all-time high recorded in the summer of 2022.”
Housing market activity has been broadly flat over the last year, with the total number of transactions down by around 15% compared with 2019 levels.
Transactions involving a mortgage are down even more (nearly 25%), reflecting the impact of higher borrowing costs. By contrast, the volume of cash transactions is actually around 5% above pre-pandemic levels.
Mortgage rates remain high
As a result, housing affordability is still stretched. Today, a borrower earning the average UK income buying a typical first-time buyer property with a 20% deposit would have a monthly mortgage payment equivalent to 37% of take-home pay – well above the long-run average of 30%.
The reaction from industry experts has been mixed. Nathan Emerson, CEO of Propertymark, said: “It’s especially positive news to see further progression within the housing market year on year, with affordability and confidence returning, despite interest rates remaining high currently.”
Meanwhile, Nicholas Finn, managing director of Garrington Property Finders, noted: “Whether it’s pre-election uncertainty or summer sluggishness, the effect is much the same – large parts of the property market are in a holding pattern.”
Property market in a holding pattern
Despite the challenges, many experts remain optimistic about the future of the housing market. Michelle Stevens, mortgage expert at finder.com, said: “As expectations of an upcoming base rate cut continue to grow, the market seems to be stabilising in anticipation of lower rates on the horizon.”
Iain McKenzie, CEO of The Guild of Property Professionals, added: “This is the last litmus test on the state of the property market before the General Election, and it is fair to say that while challenges remain, stability has returned to house prices in recent months.”
House prices stabilise before General Election
As the housing market continues to evolve, one thing is clear: the next few months will be crucial in shaping the future of the industry.
