For many, September will feel like the distant past, but the UK House Price Index remains interesting and useful.
Why? It represents a more complete picture than comparable releases. This is key in a world of ‘lies, damned lies and statistics’!
Thank you to MailOnline, Yahoo Finance, Property Reporter, London Loves Property & Mortgage Finance Gazette for featuring my comments. Click on links for full articles.
So what does the data tell us?
A 4.7% increase in house prices, with mortgage approvals at their highest level since 2007 suggests a ‘mini boom’.
Many feel this will be short lived, given economic circumstances and forecasts.
However, the ‘fundamental’ drivers of housing demand are strong: we are in an environment of low interest rates, with reduced rates of new buildings coming onto the market and limited existing stock.
Ultimately, increasing house prices are being driven by a combination of new priorities (needing more space) and new policy (SDLT reduction) and were led by detached and semi-detached properties.
New build properties lagged behind existing properties, falling by 1.9% despite the influence of the Help to Buy scheme.
For investors and homebuyers alike, the important thing to remember is that capital growth is a great bonus, but shouldn’t be relied on just because lending is cheap.