Halifax: House prices fell in September as buyers ‘paused for breath’

Is the real estate market starting to change? House prices fell in September as buyers ‘stopped for breath’, discouraged by uncertainty and rising interest rates.

  • House prices fell 0.1% in September month-on-month, according to Halifax
  • A typical UK property now costs £293,835 down from £293,992
  • The annual growth rate fell to 9.9% in September, from 11.4% in August

House prices fell slightly in September as property inflation fell back to single digits, according to Britain’s biggest mortgage lender.

Prices fell 0.1 percent in September compared with a 0.3 percent rise in August, according to the latest Halifax House Price Index. As a result, a typical UK property now costs £293,835 down from the previous month’s record of £293,992.

Annual house price inflation also eased to 9.9 percent in September, from 11.4 percent in August.

Although the monthly numbers are volatile, many will take the drop as an early sign that the housing market is beginning to turn and slow in the face of rapidly rising mortgage rates.

The housing market showed signs of slowing down in September as the price inflation rate fell to 9.9%

Kim Kinnaird, Director of Halifax Mortgages, said: “The events of the past few weeks have led to increased economic uncertainty, yet in reality, house prices have been largely flat since June, with an increase of about £250”.

‘This compares with an increase of over £10,000 over the previous quarter, suggesting that the property market may already have entered a more sustained period of slower growth.

‘Predicting what will happen next means making sense of the many variables now in play, and the housing market has consistently defied expectations of late.

‘While stamp duty cuts, a shortage of homes for sale and a strong job market support house prices, the prospect of interest rates continuing to rise sharply amid lower cost of living, more the impact in recent weeks of higher mortgage loan costs. on affordability, they are likely to put more significant downward pressure on house prices in the coming months.’

Slowing growth: The median UK house price fell to £293,835 in September, according to the latest Halifax index, but prices have been relatively stable since the summer.

The median UK house price fell in September to £293,835, but prices have been relatively stable since the summer.

During the quarter, house prices rose just 1.3 percent in the UK.

Wales experienced the strongest growth of any UK region, with house prices rising 14.8% in September, up from 15.8% the previous month. The region has an average cost of ownership of £224,490.

Jeremy Leaf, North London estate agent and former RICS Residential Chairman, said: “New buyers are pausing to catch their breath as they consider the likely pace and size of future interest rate increases, so activity is slowing down.”

New buyers pause for breath as they consider the likely pace and size of future interest rate hikes.

‘The question is whether concerns about rising mortgage payments outweigh the benefits of the recent stamp duty reduction, particularly for first-time buyers.

“The mini budget set off a chain reaction of unintended consequences that raised buyer concerns that any savings in stamp duty and other taxes would be more than offset by rising much faster and higher mortgage rates.” than expected.”

Tom Bill, head of UK residential research at Knight Frank, commented: “It’s a pretty safe bet that UK house prices have now peaked.

“The impact of rising mortgage rates will start to affect demand and purchasing power in the coming months, which we think will lead to a 10% drop over the next two years for UK prices.”

What to do if you need a mortgage

Borrowers who need to find a mortgage because their current fixed-rate agreement is coming to an end, or because they have agreed to purchase a home, have been urged to act but not panic..

Banks and building societies continue to lend and mortgages are still being offered and applications accepted.

However, rates are changing rapidly and there is no guarantee that the deals will last and not be replaced by mortgages that charge higher rates.

This is the best Money Mortgage Rate Calculator powered by L&C that can show you offers that match the value of your mortgage and property

What if I need to re-mortgage?

Borrowers should shop around and talk to a mortgage broker and be prepared to act to secure a rate.

Anyone with a fixed-rate agreement ending within the next six to nine months should consider how much it would cost to remortgage now and consider closing a new agreement.

Most mortgage deals allow fees to be added to the loan and are then only charged when you withdraw. By doing this, borrowers can lock in a rate without paying expensive setup fees.

What if I am buying a house?

Those with agreed home purchases should also aim to lock in rates as soon as possible, so they know exactly what their monthly payments will be.

Homebuyers should be careful not to overstretch themselves and be prepared for the possibility of house prices falling from their current high levels, due to higher mortgage rates limiting people’s borrowing capacity.

How to Compare Mortgage Costs

The best way to compare mortgage costs and find the deal that’s right for you is to talk to a good broker.

You can use our best mortgage rate calculator to display offers that match your home value, mortgage size, term, and fixed rate needs.

Keep in mind, however, that rates can change quickly, so the advice is if you need a mortgage, compare rates and then speak to a broker as soon as possible, so they can help you find the right mortgage for you. .

> Consult the best fixed-rate mortgages that you could apply for