Filtered by Subscriptions: UK Housing Use setting UK Housing
Signs of a more balanced market emerging The latest RICS survey brought early signs that, having been a sellers’ market for the past two years, the balance is shifting. That suggests we are right to expect a moderation in house price growth in the second …
14th April 2022
Still no sign of house price growth cooling Another large jump in house prices in March kept Halifax’s measure of house price inflation comfortably in double figures. With competition between buyers still intense, house price inflation could remain high …
7th April 2022
PMI results mixed, with more concern on the horizon The continued strength of the construction PMI in March suggests that activity in the sector increased despite ongoing headwinds from supply constraints and cost inflation. The rise in new orders …
6th April 2022
Despite strong house price growth across the country over the past two years, including in regions that had lagged behind, valuations are most stretched in the usual places. As a result, house prices are still most vulnerable to rising interest rates in …
4th April 2022
House price growth hits 18-year high, but slowdown expected The acceleration in house price growth to an 18-year high of 14.3% will add to concerns that the pandemic housing market boom is getting out of hand. With mortgage rates rising, house price …
31st March 2022
While buying a home is likely to remain a better option than renting, despite rising mortgage rates, the decision will become more finely balanced. That will mean some prospective first-time buyers rent for a bit longer, helping to cool house price growth …
30th March 2022
Decline provides an early sign that demand has begun to wane Higher than usual home moving activity ensured that mortgage approvals remained substantially above pre-virus levels in February. But the decline compared to January could be an early sign that …
29th March 2022
We think that property markets are the weak link when it comes to the impact of tightening monetary policy. A modest rise in interest rates might only cause price falls in a few obvious candidates. But rates might have to rise only a bit further than we …
25th March 2022
Most leading indicators of housing market activity and house prices remain strikingly buoyant, but the first signs that demand will soften are now appearing. There is no question that house prices will continue to rise apace over the next few months. …
24th March 2022
Mortgage rates have been slow to respond to rising market interest rates, with lenders choosing to take a hit to their margins rather than fully offset increased funding costs. But we don’t think there is any more scope for rises in Bank Rate to be …
17th March 2022
No let-up in housing market activity The February RICS residential survey continued to point to resilience in UK housing markets. New enquiries remained strong and, while there is some evidence that supply constraints may be easing at last, the number of …
10th March 2022
Lending set to rebound after stamp duty related pause While mortgage lending was softer at the end of last year that largely reflected the jolt from the ending of stamp duty discounts. More recent data point to very strong market activity in early 2022 …
8th March 2022
House price inflation reaches 15-year high The gain in house prices reported by Halifax for February pushed the annual rate to 10.8%, its highest since June 2007. With new supply limited and mortgage rates still relatively low, we suspect that house price …
7th March 2022
PMI rises further as housing activity accelerates The construction PMI rose to its highest level in eleven months in February. Although encouraging, supply constraints remain a major impediment and input costs high, which we think will limit growth in the …
4th March 2022
The sharp downturn in consumer confidence in February showed that the cost of living crisis was starting to bite even before the war in Ukraine began. But despite the worrying correlation between house prices and sentiment, our base case remains that …
3rd March 2022
House prices not headed for a bust following pandemic boom The further substantial rise in house prices in February took the increase since the pandemic began to a round 20% and begs the question whether house prices are getting too high. While we do …
2nd March 2022
More evidence that home movers remain active A third consecutive monthly rise in mortgage approvals suggests that housing market activity will remain higher than usual in the coming months as households continue to adjust to remote working. The rise in …
1st March 2022
Much has been made of UK property’s openness to Russian money following the invasion of Ukraine. But since the depreciation of the Russian ruble in 2014, Russians have become far less important to demand. As a result, we think the effects on UK property …
25th February 2022
Homeowners appear to be pressing ahead with plans to move house even though stamp duty is now fully reinstated. Transactions inevitably dipped last October as sales were rushed through in September to take advantage of the tax relief. But since then, they …
23rd February 2022
Our new, higher interest rate forecast suggests that mortgage rates will climb to an eight-year high in 2023, making house prices look expensive by historical standards. But the overvaluation won’t be as extreme as it was on the eve of the financial …
15th February 2022
We already expected that rental growth would surge to a decade-high this year. But the strength of leading indicators and the low level of rents relative to income by historical standards suggest rental growth will exceed even that forecast and remain …
11th February 2022
Housing market remained exceedingly tight at the start of 2022 The largest rise in new buyer enquiries for nine months and a reversal of the December dip in sales volumes confirmed that the housing market remained extremely tight at the start of the year. …
10th February 2022
Slowdown unlikely to signal cooling market yet The smaller gain in house prices in January reported by Halifax is unlikely to mark the start of a sharp deceleration in house price growth. With the supply of homes for sale still very limited and mortgage …
7th February 2022
Overview – It is likely to take longer than most expect for rising interest rates to cool the housing market. Mortgage rates have only just begun to rise from the record low reached in November, and limited supply, high household savings, and the boost to …
4th February 2022
Housing activity to remain buoyant despite supply challenges The tick up in mortgage approvals in December suggested that the dip in housing market activity expected after the stamp duty holiday has already come and gone, and that transactions will stay …
1st February 2022
House prices continue to surpass expectations There was no cooling in the housing market at the turn of the year, as the Nationwide house price index recorded its largest January increase for 17 years. We suspect that prices will continue to surpass …
The jump in transactions during the pandemic was larger in London than other regions as the market didn’t experience the same drop in supply as elsewhere. That reflected many existing homeowners adjusting to remote working by moving further afield, giving …
25th January 2022
Demand-supply imbalance continues to drive up prices The number of homes being listed for sale dropped again in December while demand continued to climb. As a result, we think house prices will continue to rise at pace in the near term. At -14, the new …
20th January 2022
A breakdown of house price growth over the past two years confirms that remote working has altered the nation’s housing needs. But what households can afford, rather than what they desire, will be a more important driver of house prices over the next few …
19th January 2022
Overview – Although the hit to households’ real incomes from a bigger surge in CPI inflation than most expect (to a peak of almost 7% in April) explains why we think GDP growth will be slower this year than the consensus forecast, we still think that the …
17th January 2022
Recent data have reinforced concerns about inflation risks in the UK. We remain of the view that property investments provide only limited long-term protection against higher prices, but of the individual asset types, we think industrial and residential …
14th January 2022
Credit availability to remain good, but mortgage rates to rise The Q4 credit conditions survey suggests that, while credit conditions will remain loose, scope for lenders to absorb further increases in interest rates into their margins has run out. A …
13th January 2022
PMI dips as Omicron and supply constraints take hold The construction PMI declined last month to end the year on a negative note, more than erasing the gain made in November. Despite tentative signs that they are starting to ease, we expect labour and …
7th January 2022
2021 price rise strongest for at least 15 years Another substantial rise in the Halifax house price index in December ensured that the lender agreed with Nationwide that the rise in house prices over the 2021 calendar year was the strongest for at least …
Strong demand will ensure that house prices maintain their momentum in the first half of the year. But rising mortgage rates will weigh on demand further out, causing prices to cool. The three key forces that have driven house prices higher over the past …
6th January 2022
Stabilisation in approvals consistent with robust demand Mortgage approvals stabilised in November, consistent with other evidence that demand remained robust after the stamp duty holiday ended. Even though approvals have softened to a similar level to …
4th January 2022
The continued strength of the housing market after the end of the stamp duty holiday shows that it was far more than the tax break that kept prices surging in 2021. The three key drivers of demand - low mortgage rates, high household saving, and a …
23rd December 2021
While the hike in Bank Rate from 0.10% to 0.25% came a little earlier than we expected, it does not change our view that the overall rise in interest rates over the next couple of years will be modest. However, the continued strength of both inflation and …
16th December 2021
While mortgage lending slowed in Q3 as the stamp duty holiday was tapered, an easing of deposit requirements supported first-time buyer demand. Meanwhile, the Financial Policy Committee’s plan to withdraw its affordability stress test will allow banks to …
14th December 2021
Consumers will feel a squeeze on their finances next year as inflation and taxes rise. That will take some wind out of the housing market’s sails, but it will not cause a correction. A spike in inflation and a hike in National Insurance contributions in …
13th December 2021
Continued strength suggests upside to prices in 2022 There was no sign of any let up in the house price boom in November as new buyer enquiries rose again. Another strong survey also suggests that the market could continue to run hot for some time, …
9th December 2021
Quarterly growth takes further step up to post-GFC high The Halifax house price index suggests that not only did the end of the stamp duty holiday fail to dent the market, but that house price growth has since accelerated to a post-financial crisis high. …
7th December 2021
Still no sign of house price growth cooling House prices recorded another above-consensus gain in November as strong buyer demand bid prices up further. There is little sign of that dynamic changing anytime soon, so we expect the consensus forecast for …
1st December 2021
Dip in mortgage approvals after stamp duty holiday ends Mortgage approvals remained robust in October after the end of the stamp duty holiday, only easing back into line with their pre-pandemic average. With demand strong, we suspect that mortgage …
29th November 2021
The most comprehensive statistics on housing supply confirmed that the pause in construction in Q2 2020 caused completions of new homes to drop back. Housebuilding activity has since recovered but materials shortages, the end of the Help to Buy Equity …
Estate agents undoubtedly have a very limited number of homes on the books. But the idea that the lack of supply is due to few homes being put up for sale is a misconception. High numbers of transactions inevitably mean that listings are higher than …
24th November 2021
The end of the stamp duty holiday has had remarkably little impact on buyer demand. If anything, the imbalance between strong home purchase demand and limited supply is intensifying. Indeed, Rightmove reported that the average time to sell a home …
19th November 2021
Anticipation of higher interest rates has pushed up fixed mortgage rates. And with scope for banks to absorb higher costs in their margins now exhausted, future changes in interest rate expectations will be fully passed through to mortgage rates. But as …
12th November 2021
Market remains tight after stamp duty holiday Rather than representing a “rush before mortgage rates rise”, we suspect that the rise in new buyer interest in October will prove durable. With inventory very limited, that points to house prices rising by …
11th November 2021
Overview – We think it will take longer than most others expect for rising interest rates to bring down the curtain on the COVID-19 house price boom. A large stock of household savings, the ongoing adjustment to home working and very limited stock on the …
8th November 2021
