top of page
Writer's pictureSarah Ruivivar

UK Housing Market Gains Momentum: A Positive Outlook

📸 ModelProp / Midjourney

Nationwide, the building society giant, has just given us a reason to smile.


Their index indicates that UK house prices have surged by a whopping 0.7% in January compared to the previous month. This is a significant leap from the 1.8% dip we saw in December. So, it seems we're off to a promising start in 2024!


The average UK house price now stands at a cool £257,656, albeit a slight 0.2% dip from the previous year. But hey, we're focusing on the positives here, and Nationwide's chief economist, Robert Gardner, agrees. He's quoted as saying, "While a rapid rebound in activity or house prices in 2024 appears unlikely, the outlook is looking a little more positive."


This optimistic outlook is fuelled by the downward trend in mortgage rates, which is always a welcome sign for buyers. Investors are also showing more confidence in the Bank of England's potential to lower rates in the future.


While we're on the topic of interest rates, the Bank is expected to maintain its rate at 5.25% this week. This should further stabilise the market and boost buyer confidence.


And it's not just Nationwide singing this positive tune. The Royal Institute of Chartered Surveyors (Rics) suggests that the decline in inquiries from new buyers has halted, and there are "tentative signs" of more homes appearing on the market.


However, it's not all rainbows and unicorns. Nationwide warns that the trajectory of interest rates in the coming months will be crucial as affordability pressures continue to affect the market.


The current scenario is such that a borrower with an average UK income, buying a home with a 20% deposit, would have a monthly mortgage payment equivalent to 38% of their take-home pay. This is significantly higher than the long-term average of 30%.


To bring this measure back down to 30%, mortgage rates would need to trend towards 3%.

So, while we do have some challenges ahead, it's refreshing to see some positivity in the UK housing market. Here's to hoping this momentum continues throughout the year.



Made with TRUST_AI - see the Charter: https://www.modelprop.co.uk/trust-ai

20 views0 comments

Recent Posts

See All

留言


bottom of page