What’s the latest information on house prices? We monitor the leading indicators to keep you regularly updated about all the key moves in the UK’s property market
UPDATE 2 September 2021: Nationwide cuts mortgage rates to ‘lowest-ever’ 0.87%
Nationwide is launching its lowest-ever mortgage rate for new lending after cutting its fixed and tracker range rates by up to 0.40%, to below the psychological 1% barrier
Those with a 40% deposit will be able to take advantage of a two-year fixed rate mortgage at just 0.87% or a two-year tracker at 0.99%. However, the deals come with hefty fees of £1,499 and £999, respectively.
Elsewhere, the building society is offering a 75% LTV deal at 1.00% with a £1,499 fee and a two-year fix for first-time buyers holding a 5% deposit at 2.99% (down from 3.24%) subject to a £1,499 fee. Nationwide’s first-time buyer mortgages come with £500 cashback.
The reductions haven’t just been reserved for new buyers though – remortgagers can also get the 0.87% rate on a two-year fix at 60% LTV – again for a fee of £1,499.
The biggest price cut in its remortgage range is on the building society’s two-year tracker mortgage at 60% LTV at 0.99% (down from 1.39%).
Henry Jordan at Nationwide said: “These latest reductions will offer those looking for a new deal one of the best rates available. However, reductions have been made at all loan to value levels so whether someone is buying a new home, remortgaging their existing property or getting a further advance to improve their home we have a range of mortgages on offer to suit their needs.”
Rates below 1% – but watch for high fees
Despite being the lowest rates Nationwide has ever offered, a spate of new sub 1% deals have recently come to the market from rival lenders – one of which is lower still.
Halifax has a two-year fixed rate mortgage at 0.83% with a £1,499 fee or a higher rate of 0.87% if you pay a lower fee of £999. Both are for purchases only, though, and require a 40% deposit.
Rates continue to fall as lenders try to get more people on their books amid the post-pandemic property boom – despite the fact that the Stamp Duty Land Tax holiday in England, which incentivised so many buyers since July 2020, will expire at the end of September.
Not everyone will be eligible for a sub 1% mortgage deal, since offers are subject to status. Lenders will want to see that you’re a responsible borrower with a good track record of managing credit in the past.
The relatively high fees of £1,499 attached to some of these sub 1% mortgages might not be cost-effective if you need a relatively small mortgage. In fact, depending on how much you need to borrow, you may be better off choosing a no-fee deal with a slightly higher rate.
Also, if you’re currently tied into a fixed rate mortgage and want to take advantage of a competitive new deal, you may be penalised with early repayment charges that could wipe out any benefits from switching.
And remember, rates could continue to fall, so if you sign up for one of the new cheap fixed-rate deals now, you won’t be able to jump ship when something cheaper potentially comes along without incurring penalty charges.
To see how much your repayments would be with one of Nationwide’s new deals or any other mortgage product, try our new mortgage calculator tool.
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Trussle is a 5-star Trustpilot rated online mortgage adviser that can help you find the right mortgage – and do all the hard work with the lender to secure it. *Your home may be repossessed if you do not keep up repayments on your mortgage.
UPDATE 1 September 2021 – Nationwide House Price Index
At-a-glance…
- Average UK house price was £248,857 in August, up 2.1% from July
- Second largest gain month-on-month in 15 years
- Annual house price growth stands at 11%
House prices rose by 2.1% in August, the second largest month-on-month gain in 15 years, despite predictions that the recent scaling back of stamp duty reliefs would subdue demand in the UK’s property market.
According to the Nationwide House Price Index, annual house price growth rose to 11% in August 2021 with the average home valued at £248,857. Nationwide added that house prices are now about 13% higher than when the pandemic began.
Nationwide described the August increase as “surprising” following the tapering of stamp duty reliefs at the end of June.
Robert Gardner, Nationwide’s chief economist, said: “The strength may reflect strong demand from those buying a property priced between £125,000 and £250,000 who are looking to take advantage of the stamp duty relief in place until the end of September, though the maximum savings are [now] substantially lower.
“Lack of supply is also likely to be a key factor behind August’s price increase, with estate agents reporting low numbers of properties on their books. Activity will almost inevitably soften for a period after the stamp duty holiday expires at the end of September.”
Miles Robinson, head of mortgages at online mortgage broker Trussle, said: “Today’s results will come as a surprise as many expected to see a contraction in the market as the stamp duty holiday (in England) draws to an end. However, while unprecedented demand has meant sellers have very much been in the driving seat this past year, there are now some great opportunities for would-be house hunters. In particular, next-time buyers who have equity or larger housing deposits can take advantage of some incredibly competitive interest rates.”
Nicky Stevenson, managing director of national estate agency chain Fine & Country, said: “While the stamp duty holiday savings on big homes are quickly vanishing, a greater proportion of market activity is now in the mass market sector, buoyed by the resurgence of buy-to-let investing and first-time buyers.”
UPDATE 26 August 2021 – Zoopla notes ‘acute shortage’
At-a-glance
- Properties selling almost twice as quickly as in 2019
- Price growth highest in Wales and Northern Ireland
The UK property market faces an “acute shortage” of homes for sale, after a record number of transactions to beat changes to the temporary stamp duty regime used up available stock, according to the property portal Zoopla.
Latest figures from the firm’s House Price Index showed that the number of properties for sale in June dropped by 26.4% compared with the 2020 average.
Zoopla said buyer demand remains strong, up 20.5% compared with the 2020 average. The figures also showed that competition among buyers intensified through the second half of 2020 and into 2021.
It said the average time to sell, measured as the time taken between a property being listed and a sale being agreed, now stands at 26 days, down from 49 days in 2019.
At a regional level, property price growth around the UK over the past year was highest in Wales (up 9.4%), Northern Ireland (9%) and the north west of England (7.9%). In terms of city locations, Liverpool led the way with price growth of 9.4%
Zoopla said first-time buyers have been increasingly active in 2021, supported by lenders that have reintroduced products accommodating higher loan-to-value (LTV) mortgages. See below for comment on the impact of LTV deals.
Maximum LTV mortgages ‘failing to secure market share’
- 95% mortgages accounted for just 1% of mortgages in July
- 49 lenders offer 95% mortgage deals
According to research from our mortgage partner, Trussle, the recent crop of 95% loan to value (LTV) mortgages coming to market is not resulting in successful applications from would-be borrowers.
The online broker has seen interest in 95% LTV deals account for a quarter of all its mortgage enquiries in recent months, but says that just 1% of its mortgage completions were from 95% mortgages in July 2021. It attributes this to the fact that high LTV mortgages are subject to stricter lending criteria and require higher credit scores.
Additionally, many lenders do not accept ‘gifted deposits’ (where the borrower uses funds given to them by their parents, for example) on 95% LTV deals. Also, some property types like flats and new builds are ineligible for the 95% deals on offer.
Trussle says there are currently 49 lenders offering 95% LTV mortgages, with the number of lenders steadily increasing since March. Its data shows that 60% of all leads for 95% mortgages were first time buyers, with ‘next time’ buyers (34%) and remortgages (6%) making up the rest.
While 95% mortgages are struggling to make an impact on the market, Trussle says other high LTV mortgage brackets are seeing significant demand from consumers. For example, 90% mortgages have been a popular choice for those needing higher LTV products, accounting for 10% of Trussle completions in June 2021, the highest since August last year.
UPDATE 24 August 2021 – HMRC property transactions
At-a-glance
- Property transactions plummet by 63% month-on-month
- Reduction in stamp duty relief triggers decline
UK monthly property transactions fell dramatically in July 2021, with seasonally adjusted transactions for July standing at 73,740, a 62.8% drop compared with the figure reported in June, according to the latest data from HMRC.
The fall coincided with the tapering of a temporary, pandemic-enforced reduction in Stamp Duty Land Tax at the end of June in England and Northern Ireland.
Until 1 July, the first £500,000 of a property purchase was exempt from stamp duty. This figure now stands at £250,000 and will be reduced again, to £125,000, from 1 October 2021.
The end of June also marked the end of the temporarily increased nil rate band to £250,000 for residential Land Transaction Tax in Wales. It has reverted to £180,000.
HMRC estimated the provisional non-seasonally adjusted figure for UK residential transactions in July 2021 at 82,110.
Adam Forshaw at conveyancing firm O’Neill Patient said: “It was to be expected that housing transactions would be lower in July, but 62.8% is quite a drop. Having said that, June was a record month as the conveyancing industry worked hard to get as many house sales over the line before the first phase of the stamp duty holiday ended.
“We are still seeing a good level of instructions in house sales and purchases as people are still eager to beat the final stamp duty holiday exemption on 30 September.”
UPDATE 18 August 2021 – ONS House Price Index
At-a-glance:
- Average UK property now worth £265,668
- Price growth strongest in north west of England
- Transactions in June 219% higher than 2020
The average price of a UK property was £265,668 in June 2021, according to the UK House Price Index from the Office of National Statistics (ONS).
The ONS said that, on average, property prices rose by 13.2% in the year to June 2021.
It added that the strongest house price growth achieved over that period had been recorded in the north west of England with a return of 18.6% in the year to June.
Elsewhere around the regions, London recorded the most sluggish rise in annual growth returning a figure of 6.3% over the same period.
Figures from UK Property Transaction Statistics estimated that 198,240 transactions took place on residential properties worth £40,000+ in June 2021. This was a 219% increase on the same month a year ago.
Miles Robinson at online broker Trussle, said: “House price growth remains strong with an average increase of 13.2% over the year to June 2021. Much of this can of course be attributed to the buyers and sellers who grappled to complete before the 30 June higher threshold stamp duty deadline.”
“While house prices have increased on average, the industry is starting to see a slow-down in the rate at which property value is appreciating. With the stamp duty deadline coming to a complete close in the nearing weeks, it is likely that house price growth will start to cool off slightly,” Robinson added.
UPDATE 16 August 2021 – Rightmove House Price Index
At-a-glance
- Average asking price of properties coming to market down £1,076, a 0.3% dip
- Prices of larger properties slip by 0.8%
- Demand remains high for ‘mass market’ properties
House asking prices fell for the first time in 2021, according to the latest data from property portal Rightmove.
The firm said the average price of property coming to market in August dipped by £1,076, a decrease of 0.3%.
Rightmove explained that the slight cooling was mainly driven by a 0.8% fall in the price of upper-end, four-bedroom-plus properties, a result of the tapered stamp duty holiday which comes to an end next month.
It added, however, that first-time buyer and second-stepper properties – each less affected by the withdrawal of most stamp duty initiatives – continued to rise in price by 0.6% and 0.3% respectively.
The portal said that overall demand from buyers remains strong and suggested this could prompt an Autumn “bounce” in both prices and seller activity.
Tim Bannister, Rightmove’s director of property data, said: “New sellers dropping their asking prices can ring economy alarm bells, especially when it’s the first time so far this year.
“It’s important to dig underneath the headline figures. We are in the holiday season which means that sellers have traditionally tempted distracted buyers with lower prices. Our analysis shows that average prices have only fallen in the upper-end sector, which is usually more affected by seasonal factors such as the summer holidays.”
Free Mortgage Advice
Trussle is a 5-star Trustpilot rated online mortgage adviser that can help you find the right mortgage – and do all the hard work with the lender to secure it. *Your home may be repossessed if you do not keep up repayments on your mortgage.
UPDATE 6 August 2021 – Halifax UK House Price Index
At-a-glance
- Average UK house price stands at £261,221 in July 2021, up 0.4% from June
- Annual house price growth slowed to 7.6%
- Wales records strongest house price growth for 16 years
UK house prices rose by 0.4% in July, with the average property now worth £261,221, according to the Halifax House Price Index.
Halifax reported a fall in annual house price growth to 7.6% in the 12 months to July 2021.
The lender said this easing was to be expected for two reasons. First, the price inflation experienced by the property market last summer as it emerged from the first lockdown and, second, the buying activity prompted by the government’s time-limited stamp duty holiday initiative.
According to the Halifax, Wales recorded an annual house price increase of 13.8% to the end of July, its strongest growth figure since 2005. The North West England, Yorkshire and Humberside, and the South West also posted double-digit rises year-on-year.
Russell Galley, the Halifax’s managing director, said: “Recent months have been characterised by historically high volumes of buyer activity, with June the busiest month for mortgage completions since 2008. This has been fuelled both by the ‘race for space’ and the time-limited stamp duty break.
“With the latter now entering its final stages, buyer activity should continue to ease over the coming months, and a steadier period for the market may lie ahead,” Galley added.
Miles Robinson, head of mortgages at Trussle, the online mortgage broker, said: “There are many positives for homeowners to take from the market at the moment. An increasing number of high-profile lenders are now offering sub 1% mortgage products, with some available on a fixed-term rate for up to five years.”
UPDATE 2 August 2021 – Londoners flock to buy homes outside capital
At-a-glance
- Record number of Londoners buy homes outside capital
- Properties located on average 34.6 miles from capital
- Pandemic-fuelled city ‘out-migration’ shows no sign of stopping
Londoners bought a record number of homes outside the capital in the first six months of 2021 according to estate agent Hamptons.
The firm said Londoners have led the way in “city out-migration”, one of the key property market trends of the pandemic. Between January and June 2021, Londoners bought 61,830 homes outside the capital, with properties located an average 34.6 miles away from the capital.
Hamptons said this was the highest half-year figure since its records began in 2006. Putting the figure into context, the estate agency said it was only 10,030 homes fewer than those sold in London during the whole of 2020.
On average, Londoners paid £389,975 for their new properties.
So far this year, Londoners made up 8.6% of all buyers outside the capital. This was the highest proportion on record and up from the 6.6% reported over the same period last year.
Aneisha Beveridge, head of research at Hamptons, said: “Pandemic-fuelled city out-migration shows no sign of slowing. Despite lockdown easing and offices and restaurants re-opening, Londoners have continued to re-evaluate where they want to live.
“The capital’s loss has been the Home Counties’ gain. The mix buying beyond the capital has changed, with first-time buyers more likely to leave London than ever before.”
UPDATE 28 July 2021 – Nationwide House Price Index
At-a-glance
- Average UK house price stands at £244,229 in July 2021, down 0.5% from June
- Annual house price growth slowed to 10.5%
House prices fell by 0.5% in July thanks to the tapering of stamp duty relief in England and the ending of the duty holiday in Wales.
According to the latest Nationwide House Price Index, annual house price growth slowed to 10.5% in July 2021, having peaked at a 17-year high of 13.4% a month earlier. It described July’s reverse as a “modest fallback”, saying this is unsurprising given the significant gains recorded in recent months.
Robert Gardner, Nationwide’s chief economist, said: “House prices increased by an average of 1.6% a month over the April to June period, more than six times the average monthly gain recorded in the five years before the pandemic.
“The tapering of stamp duty relief in England is likely to have taken some heat out of the market. This provided a strong incentive to complete house purchases before the end of June.”
Nationwide said stamp duty changes drove the number of housing market transactions to a record high of almost 200,000 in June as homebuyers rushed to meet the deadline. This was around twice the number of transactions recorded in a typical month before the pandemic and 8% above the previous peak seen in March 2021.
UPDATE 27 July 2021 – Savills predicts 9% price growth
At-a-glance
- Savills predicts 9% UK house price growth for 2021
- Prices set to rise by 21.5% over five years to 2025
- Property markets in the Midlands and the North-East of England expected to perform best
Estate agency Savills has predicted that UK house prices will rise by 9% in 2021 thanks to a combination of factors including extended stamp duty holidays, plus the impact of repeated lockdowns on what buyers want from their homes.
Savills said it also expects average house prices to rise by a further 3.5% next year and by a total of 21.5% in the five years to the end of 2025.
Since the property market re-opened last year after the first phase of the pandemic, Savills said price growth had been driven in large part by more affluent buyers, less reliant on mortgage debt and able to lock into low, fixed interest rates. Homes featuring plenty of space, both inside and out, have been high on buyers’ wish lists over the past year.
According to Savills, the property markets of both the Midlands and the North of England are anticipated to show the strongest price growth. It said both regions could sustain a rise in house prices before homes in these areas become unaffordable.
Lucian Cook, Savills’ head of residential research, said: “Some of the growth generated by the extraordinary market conditions of 2020 and 2021 could unwind during 2022, but we see nothing on the horizon that would trigger a major house price correction.
“New buyer demand continues to outweigh supply. This imbalance looks set to continue, underpinning further price growth over the near term, particularly as people look to lock into current low interest rates,” he added.
UPDATE 27 July 2021 – Zoopla House Price Index
At-a-glance
- Average UK house price stands at a record £230,700
- House prices up 5.4% in the year to June 2021
- Northern Ireland records highest house price growth in past year
UK house prices reached a new high last month, with the average property now worth £230,700, according to the house price index from Zoopla, the property portal.
Zoopla reported a 25% fall in the number of homes for sale in the first half of this year compared to the same period in 2020, resulting in what it describes as a “severe shortage” of housing stock. This has helped push up house prices by an average of 5.4% in the year to June 2021, it said.
At a regional level, Northern Ireland recorded the highest house price growth at 8.6% over the past year, followed by Wales at 8.4%. The North West was responsible for England’s highest growth figure at 7.3%. In London, prices rose by 2.3% in the past 12 months.
Zoopla said it expected price growth to edge up to 6% in the coming months before easing back by the end of the year once the impact of the extended stamp duty holiday has unwound.
Grainne Gilmore, Zoopla’s head of research, said: “Demand for houses is still outstripping demand for flats. There is a continued drumbeat of demand for more space, both inside and outside, among buyers funnelling demand towards houses and resulting in stronger price growth for these properties.”
UPDATE 21 July 2021 – HMRC property transactions
At-a-glance
- Property transactions break record as buyers scramble to beat stamp duty deadline
UK monthly property transactions soared to record figures last month as would-be buyers scrambled to complete purchases ahead of changes to the rules on stamp duty. Seasonally adjusted transactions for June stood at 198,240, according to the latest data from HMRC.
The figure was 219% higher compared with the same month in 2020 when the effects of the pandemic impacted heavily on the property market. Last month’s figure was also 74% higher than the one recorded for May 2021, according to HMRC.
HMRC estimated the provisional non-seasonally adjusted figure for UK residential transactions in June 2021 at 213,120. This was the highest monthly figure since records began in 2005.
Last month’s flurry of activity coincided with an end to the temporary, pandemic-enforced rules on Stamp Duty Land Tax which had been in place until 30 June 2021 in England and Northern Ireland.
Until the end of June, the first £500,000 of a property purchase was exempt from stamp duty. This figure was subsequently cut to £250,000 from 1 July and will be reduced again, to £125,000, from 1 October 2021.
In Wales, the Land Transaction Tax holiday came to an end on the same day, with the exemption falling from £250,000 to its permanent level of £180,000.More information on stamp duty changes around the devolved nations can be found here.
UPDATE 19 July 2021 – Rightmove House Price Index
At-a-glance:
- Average price of properties coming to market at all-time high of £338,447
- Average price up by more than £21,000 since start of 2021
- Shortfall of 225,000 properties for sale
“Frenzied” UK housing market activity in the first half of 2021 pushed the average price of newly-listed properties to a record-breaking £338,447, according to the latest data from property portal Rightmove.
The firm said a record figure had been achieved in each of the past four months. The average property price is now £21,389 (6.7%) higher than at the start of 2021.
In May to June 2021 alone, the average property price rose by £2,374. Rightmove said this was the largest increase recorded at this time of year since 2007.
Rightmove added that the combination of 140,000 sales being agreed in the first half of 2021, plus 85,000 fewer listings compared with the long-term average, had produced a shortfall of 225,000 homes for sale.
Detached homes with four or more bedrooms have experienced the largest imbalance in terms of supply and demand since the start of 2021, with a 39% surge in sales but a 15% fall in numbers.
Rightmove estimated that the average number of available properties for sale per estate agency branch is now at a record low of 16.
Tim Bannister, Rightmove’s director of property data, said: “New stamp duty deadlines in England and Wales for sales completed by the end of June helped to exhaust the stock of property for sale and concentrate activity.”
UPDATE 15 July 2021 – ONS UK House Price Index
At-a-glance:
- Average UK property now worth just under £255,000
- Annual house price growth strongest in north west of England, sluggish in London
- Property transactions for May 2021 138% higher than a year earlier
The average price of a UK property was £254, 624 in May 2021, according to the UK House Price Index from the Office for National Statistics (ONS).
The ONS said that, on average, property prices had risen by 10% across the UK in the year to May 2021.
It added that the strongest house price growth over that period had been recorded in the north west of England with a return of 15.2%. London, meanwhile, recorded the most sluggish rise in annual growth returning a figure of just 5.2% in the year to May.
According to the Bank of England, mortgage approvals stood at 87,500 for May 2021. The figure was up slightly from the previous month, but lower than the recent peak of 103,400 reported in November 2020.
Figures from UK Property Transaction Statistics estimated that 114,940 transactions on residential properties worth £40,000 had taken place in May 2021. This was a 138% increase in the figure recorded for the same month in 2020.
UPDATE 7 July 2021 – Halifax UK House Price Index
Property prices fell in June for the first time since January, suggesting the UK housing market may be reacting to changes in the UK’s land tax regimes.
The average house price slipped to £260,358 last month, according to the latest data from the Halifax House Price Index. The figure was down 0.5% from the 14-year high of £261,642 recorded in May this year.
However, the June figure is still £21,000 higher than it was at the same time last year – a year-on-year increase of 8.8%.
Free Mortgage Advice
Trussle is a 5-star Trustpilot rated online mortgage adviser that can help you find the right mortgage – and do all the hard work with the lender to secure it. *Your home may be repossessed if you do not keep up repayments on your mortgage.
Halifax said the strongest regional growth over the past 12 months was recorded in Wales (12%), Northern Ireland (11.5%) and the north-west of England (11.5%).
Russell Galley at Halifax said: “With the Stamp Duty holiday now being phased out (in England and Northern Ireland), it was predicted the market might start to lose some early steam entering the latter half of the year.
“It’s unlikely that those with mortgages approved in the early months of the summer expected to benefit from the maximum tax break, given the time needed to complete transactions.”
Forbes Advisor UK’s mortgage partner, broker Trussle, says there may still be time for people in certain English postcodes to complete their purchase before the final changes take effect on 30 September.
Between now and then, the Stamp Duty nil rate band stands at £250,000. It will revert to £125,000 from 1 October.
The holidays on the equivalent duties ended in Scotland on 31 March and in Wales on 30 June.
Miles Robinson at Trussle said: “While house prices have stalled month-on-month, it’s important to remember that annual growth remains strong. This is because prices have been driven by an imbalance between demand and supply for the past year.”
Nicky Stevenson at estate agents Fine & Country said: “The housing market has been running on rocket fuel for some time, but this is evidence that things may finally be starting to plateau. But there’s no suggestion we’re now facing a nosedive. Annual price rises across most of the UK remain impressive and make growth in previous years look rather mundane.”
https://www.forbes.com/uk/advisor/personal-finance/2021/09/02/house-prices-updates/
