Land Registry House Price Index – UK property market remains “cautiously positive”
The UK property market remains “cautiously positive”, according to the latest publication of the Land Registry House Price Index.
The pace of annual house price growth slowed in July to 2.2%, coinciding with the build up to the General Election, Land Registry figures show.
The latest Land Registry House Price Index for July 2024 shows average prices rose 2.2% annually to £289,723, slower than the 2.7% posted for June.
This puts average UK property prices at £289,723, up 0.6% on a monthly basis, which is down from 1.1% between May and June.
On a seasonally adjusted basis, average house prices in the UK decreased by 0.4% between June 2024 and July 2024.
Of English regions, annual house price inflation was highest in the North East, where prices increased by 3.8% in the 12 months to July 2024.
London was the English region with the lowest annual inflation, where prices decreased by 0.4% annually.
The time lag on Land Registry data means many of these sales will have been registered after completing in May and June, coinciding with the General Election campaign.
Commenting on the data, Nick Leeming, chairman of Jackson-Stops, said:
“For the first time, house prices are reflecting a cautiously positive afterglow from Labour’s election victory and showing a promising picture for the start of Autumn.
“Post-election stability coupled with the first base rate cut in four years – which has steadied mortgage rates – have renewed buyers’ intent and underpinned stronger house price growth.”
Across the Jackson-Stops network in July, completions were on a par with a year prior and up significantly month-on-month, Leeming said.
New applicant levels also increased by 18% annually and rose 10% month-on-month, Jackson-Stops said.
Leeming added:
“Yet, the property market knows all too well that calling 2024 the year of recovery would be premature.
“We are now on the cusp of Labour’s first Budget in more than a decade, and expectations are already being managed with difficult decisions on the cards.
“While strengthening the UK’s financial resilience is a clear priority for the new Government, anything that could undermine what has become a positive period of activity in the property market, should be approached with caution and handled with care.
“Buyers’ confidence will always, to varying extents, be influenced by the wider economic picture.
“It is essential the new Government introduces polices to address the supply and demand imbalance, but at a rational rate.
“The market needs consistency and certainty, not knee-jerk reactions and short-term solutions.”
Nicky Stevenson, managing director at national estate agent group Fine & Country, said:
“The economy may have flatlined in July, but the property market is showing resilience in the face of ongoing challenges and is still showing healthy levels of annual growth.
“This divergence highlights the complexity of the current economic landscape. Recent indicators present a mixed picture.
“On one hand, GDP growth has stalled, suggesting a potential slowdown in economic activity.
“Meanwhile, inflation has stayed close to the government’s 2% target, with this data showing it held steady at 2.2% in August.
“Experts predict that we could see a further drop in the base rate later this year, although this remains contingent on inflation trends and other economic factors.”
Stevenson suggested the October Budget will be another key moment to watch, with potential tax rises being discussed as a means to manage public finances.
Stevenson added:
“If introduced, these could affect consumer spending power and add pressure to households.
“Broader economic indicators paint a mixed picture. Growth is stagnant, inflation is steady, and potential tax changes loom.
“However, the housing market remains robust, and recent mortgage rate cuts hint at a positive shift ahead.
“These factors will play a key role in shaping the economic outlook in the coming months.”
Iain McKenzie, chief executive of The Guild of Property Professionals, added:
“Another month of positive annual growth tempered by a modest fall in month-on-month figures will receive a mixed reception among estate agents and home-sellers.
“Affordability concerns and a shortage of housing in some areas of the country are still an obstacle for prospective buyers, but the sense of stability we are seeing is good news for sellers and is allowing lenders to be more generous with mortgage offers.
“It still looks likely that house prices will remain stable for the rest of the year, though it won’t be until the Budget that we get an idea of how they will shape up for 2025.
“We would like to see some incentives to buy in the Budget. Alternatively, a clear strategy for building new homes and spelling out what they are going to do to support young first-time buyers struggling to save for a deposit.
“The property industry is at a crossroads and the next few months will be critical.
If government decision-making is strategic and practical, any signs of volatility would be appeased.”
Kindly shared by Estate Agent Today
