As we move into the final quarter of 2024, there’s plenty to be positive about within the UK housing market, with a strong outlook for the coming months.
House prices have risen once more on both a monthly and an annual basis, as the UK housing market continues to react positively to improved interest rates and a better inflation landscape.
The latest index released by Nationwide, which looks at transaction data and pricing on mortgaged properties, has found a house price increase of 3.2% year-on-year in September, bringing the average home value up to £266,094. The index does not take into account cash purchases, which if included may show different results.
Since last month, the average property price has risen by 0.7%, as the momentum that picked up over the summer continues to reveal the strong appetites of buyers in the UK housing market at the moment – as well as sellers keen to get their transactions underway ahead of Christmas.
Nationwide notes that this is the fastest annual rate of growth seen since November two years ago, when the market first began to show signs of slowing down in the aftermath of the Truss government’s mini Budget.
The upcoming Budget has also been noted as a potential influencing factor. It is the first Autumn Statement under the new Labour government, and some buyers and sellers may have been more eager to complete sales ahead of any changes that may come about for the UK housing market.
The report noted: “Income growth has continued to outstrip house price growth in recent months while borrowing costs have edged lower amid expectations that the Bank of England will continue to lower interest rates in the coming quarters.
“These trends have helped to improve affordability for prospective buyers and underpinned a modest increase in activity and house prices, though both remain subdued by historic standards.”
Top areas in UK housing market
Looking at the quarterly results, most parts of the country saw an annual house price rise in the latest index, with only East Anglia reporting a fall in property prices of 0.8% year-on-year.
In England, the North West has once again retained its crown with the strongest house price growth, reporting a 5% annual increase this quarter. As has been the case for some months, in the UK housing market as a whole this comes second to Northern Ireland, where prices grew by a well above average 8.6% annually.
On the ground, agents in the North West have reported extremely high appetite from buyers in recent years, fuelled by ongoing regeneration and investment in the North as part of the Levelling Up initiative, with transport and infrastructure improvements also boosting the job markets there.
Places like Manchester, Liverpool and Birmingham remain firm favourites among property investors seeking strong returns from the UK housing market, as well as homebuyers looking to get more from their money while benefiting from living in a cosmopolitan – and constantly improving – location.
Stability for the rest of the year
Looking at the trends over the course of 2024, it seems that the UK housing market should continue on a steady track for the remainder of the year, provided there are no major economic shifts.
All eyes will be on both inflation rates and the next Bank of England meeting on 7th November, when the Monetary Policy Committee (MPC) will once again vote on where interest rates will go next. A positive outcome is likely to lead to even greater momentum for the UK housing market in the coming months.
Commenting on the latest Nationwide HPI, Nathan Emerson, CEO of Propertymark, said: “As 2024 has progressed, it has been extremely positive to see a firm trend of growth emerge across the year within the housing market.
“We have seen the economy settle down to a position that provides far greater consumer confidence and although we are still at the very start of the journey regarding base rates, we are starting to see lenders introduce improved competitive offerings when it comes to mortgage deals, which is a firm foundation for confidence and growth over the coming months.”
Meanwhile, Iain McKenzie, CEO of The Guild of Property Professionals, said of the latest UK housing market data: “The biggest surge in house price growth in two years will be met with open arms by homeowners looking to sell.
“House prices usually remain robust at this time of the year, as there is still time to buy, complete and move in before Christmas.
“The final quarter of 2024 will hopefully be more of the same, if current market conditions remain in place. While continued positive growth mostly benefits sellers, it brings a sense of stability that buyers will appreciate once they have signed on the dotted line and do not want their property to devalue.
“Affordability concerns still loom for first-time buyers, but as earnings are currently outpacing house price growth, this should go some way towards bridging the gap for those who are close to getting their foot on the ladder.
“In a month’s time, the new Chancellor will take to the despatch box to unveil her first budget and give the property industry a good indication of how this government will engage with it.
“The theme of the Autumn Budget will likely focus on decisions that aim to grow the economy, while spending carefully, which will in turn keep the markets stable and avoid any shock waves to ripple down to the housing market.
“We need to see a renewed push to help people own their own home and any incentives from the Government to help further that goal would be welcome by buyers and sellers alike.”
If you’re looking for your next property investment opportunity in one of the UK’s top-performing towns and cities, contact BuyAssociation today to find out how we can help.
