UK House Prices Face Uncertainty Ahead of Budget
The UK's housing market has shown signs of resilience, but buyers are holding back due to uncertainty over the upcoming budget. In October, the average house price rose by 0.3% month-on-month, according to Nationwide, although this is a slower pace than the previous month and down from 0.5% in September.
Despite this slowdown, annual house price growth remained steady at 2.4%, up from 12 months ago. However, some analysts are attributing the continued growth to buyers "sitting on the sidelines" waiting for the budget, which may bring new property taxes or changes to mortgage rates.
The prospect of further rate cuts has been seen as a key factor supporting house prices, with mortgage rates more than doubling since the Covid pandemic. Yet, higher interest rates have also had an impact on the market, particularly at the higher end of the price spectrum.
Industry experts say that some reports of a slowdown in sales of more expensive houses may come under greater scrutiny in the budget. However, property listing website Rightmove has reported "resilience" in the number of properties coming to market, although it notes that there is no usual "autumn bounce" in asking prices.
With the chancellor's office considering a new tax on homes worth over £500,000, buyers are likely to be keeping an eye on what next month's budget will bring. Treasury officials have yet to confirm whether this plan will go ahead, but it could add complexity to an already uncertain market.
While lower interest rates have helped support activity, the housing market remains fragile due to subdued consumer confidence and weakening labour markets. Despite these challenges, analysts say that the market has exhibited broad stability in recent months, with continued rises in house prices and a similar number of mortgages approved for house purchases as before the pandemic.
The Bank of England is expected to cut borrowing costs again on Thursday, which could provide further support to the market. If income growth continues to outpace house price growth, Nationwide expects housing affordability to improve modestly in the coming months. However, for now, buyers are choosing to wait and see what the future holds for their finances and property prices.
The UK's housing market has shown signs of resilience, but buyers are holding back due to uncertainty over the upcoming budget. In October, the average house price rose by 0.3% month-on-month, according to Nationwide, although this is a slower pace than the previous month and down from 0.5% in September.
Despite this slowdown, annual house price growth remained steady at 2.4%, up from 12 months ago. However, some analysts are attributing the continued growth to buyers "sitting on the sidelines" waiting for the budget, which may bring new property taxes or changes to mortgage rates.
The prospect of further rate cuts has been seen as a key factor supporting house prices, with mortgage rates more than doubling since the Covid pandemic. Yet, higher interest rates have also had an impact on the market, particularly at the higher end of the price spectrum.
Industry experts say that some reports of a slowdown in sales of more expensive houses may come under greater scrutiny in the budget. However, property listing website Rightmove has reported "resilience" in the number of properties coming to market, although it notes that there is no usual "autumn bounce" in asking prices.
With the chancellor's office considering a new tax on homes worth over £500,000, buyers are likely to be keeping an eye on what next month's budget will bring. Treasury officials have yet to confirm whether this plan will go ahead, but it could add complexity to an already uncertain market.
While lower interest rates have helped support activity, the housing market remains fragile due to subdued consumer confidence and weakening labour markets. Despite these challenges, analysts say that the market has exhibited broad stability in recent months, with continued rises in house prices and a similar number of mortgages approved for house purchases as before the pandemic.
The Bank of England is expected to cut borrowing costs again on Thursday, which could provide further support to the market. If income growth continues to outpace house price growth, Nationwide expects housing affordability to improve modestly in the coming months. However, for now, buyers are choosing to wait and see what the future holds for their finances and property prices.
it's like they're all just waiting for someone else to make the first offer or something. And with all these reports of potential new taxes, people are literally sitting on their hands, just watching and waiting to see what's gonna happen next 
I mean, we've been hearing about interest rate cuts and tax changes for ages and it's still all just speculation. Can't we have a clear plan for once? The fact that people are literally sitting on the sidelines waiting for something to happen is just ridiculous. And what's with this £500k tax thing? Are they expecting everyone to sell their homes and move in with their in-laws because of some dodgy budget announcement? It's all just too much 
, yeah rightmove's saying resilience is good, but come on, £500k tax tho? 
that's like, a whole new level of crazy. gotta keep an eye on the budget, defo don't wanna get caught with a big purchase and then some unexpected tax slapped on it 
anyway, bank of england cuts interest rates again, should help stabilize the market... fingers crossed 
I'm not even getting into the whole 'autumn bounce' thing right now... Rightmove says there's 'resilience' in listings coming in? Are they out of their minds?! 
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... nationwide says affordability might improve a little in the next few months, but for now, buyers just wanna wait and see what happens 
. I just hope they address those plans for higher taxes on expensive homes - we need more affordable options for people! 
. I mean, buyers are already nervous about uncertainty ahead of the budget, and now they gotta worry about property taxes too? It's like, they're holding back, waiting for the Chancellor to make his move 
. I think the market is just trying to wait it out, see what happens next 
. Fingers crossed the Bank of England cuts borrowing costs again and gives it some breathing room 
