Housing Market Slows as Budget Fears Increase

UK property prices saw a modest increase in October, with asking prices rising just 0.3%, well below the typical 1.3% growth for this time of year, according to data from property website Rightmove. The lacklustre performance comes amid widespread anticipation of Chancellor Rachel Reeves’ upcoming Budget on 30 October, which many fear could include policy changes or tax increases that may further stifle house price growth.

In addition to budget concerns, the market is experiencing a surge in the number of available properties, which has contributed to the stagnation in price increases. Rightmove reports that the number of homes for sale is 12% higher compared to the same period last year, giving buyers more options and forcing sellers to price their properties competitively.

Tim Bannister, Rightmove’s director of property science, commented on the market dynamics, stating: “This month’s subdued price growth comes as buyer choice soars to a level not seen since 2014. With the ball in the buyer’s court, sellers need to be pricing competitively to find a buyer.”

Bannister also noted that some prospective buyers are delaying their decisions, waiting for clarity from the Budget and expecting lower mortgage rates later in the year.

Buying in New Towns Offers Significant Savings

The latest analysis from Halifax highlights the potential savings for buyers looking to purchase in post-World War II “new towns.” According to the lender, homes in these towns are, on average, £50,000 cheaper than properties elsewhere in the UK. The average house price in a new town, such as Milton Keynes, stands at £300,656, compared to the UK average of £346,995.

Over the past 30 years, property prices in new towns have risen by 441%, slightly below the 454% increase seen across the UK. However, some new towns have experienced even steeper growth. Crawley in West Sussex tops the list, with house prices soaring by 543% since 1994, rising from £63,712 to £409,836.

What’s Happening with House Prices Nationwide?

According to official figures, UK house prices increased by 1.5% in August, pushing the annual growth rate to 2.8%. The average price of a property now stands at £293,000, representing an £8,000 increase compared to the previous year.

The Land Registry’s house price index, which tracks both cash and mortgage-based purchases, showed the North West leading the country with annual price growth of 4.6% in the 12 months to August. The South West recorded the slowest growth at just 0.8%.

Jeremy Leaf, an estate agent and former chairman of the Royal Institution of Chartered Surveyors (RICS), noted that despite economic and political uncertainty, the comprehensive Land Registry data reflects the housing market’s resilience over the past few months.

Regional House Price Trends

Northern Ireland saw the sharpest house price increases across the UK, with values rising by 6.4% over the past year to reach an average of £185,000. Scotland followed with a 5.4% increase, bringing the average property price to £200,000. In Wales, prices grew by 3.5% to £223,000, while in England, the average house price rose by 2.3% to £310,000.

Within England, the North West led the way with a 4.6% annual increase, followed by Yorkshire and the Humber (4.4%) and the West Midlands (2.6%). The slowest growth was recorded in the South West (0.8%) and London (1.4%), where the average home now costs £531,212.

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