UK House Prices Remain Subdued, But Mortgage Rate Cuts Offer Hope

The UK housing market has remained subdued for a third consecutive month, with the average house price standing at £288,455 in June. According to Halifax, a top UK high street bank, the market has been affected by a shortage of available properties, rather than a lack of demand from buyers.

Housing market stability

Amanda Bryden, Halifax’s head of mortgages, stated that the continued stability in house prices reflects a market that remains subdued, though overall activity has been recovering. She added that the shortage of available properties is underpinning higher prices.

Mark Harris, the chief executive of mortgage broker SPF Private Clients, noted that the big five lenders - Barclays, HSBC, Santander, Halifax, and NatWest - have been reducing their mortgage rates, which is welcome news for hard-pressed borrowers.

The Impact of Mortgage Rate Cuts

The recent cuts in mortgage rates have offered hope for the market, with lenders continuing to jostle for business as they ramp up summer sales. According to Bryden, property prices are likely to rise modestly through the rest of this year and into 2025, based on current expectations.

Mortgage rate cuts

Jeremy Leaf, a north London estate agent and former residential chair of the Royal Institution of Chartered Surveyors, stated that the election had added to nervousness in the property market, but slower-than-expected falls in mortgage rates weighed more heavily. He added that the rise in listings means prices will stay stable, and the arrival of a new government will add certainty.

What’s Next for the UK Housing Market?

As the UK housing market continues to navigate the challenges of the current economic climate, it’s clear that the recent cuts in mortgage rates have offered a glimmer of hope. With lenders competing for business and property prices expected to rise modestly, it’s an interesting time for those looking to enter the market.

UK housing market outlook