House prices rose 13.6% in August according to official figures, as experts predict the median price could reach £300,000 despite economic uncertainty.
Across the UK, the median house price is now £295,903, up 0.9% from July, according to the Office for National Statistics.
The rate of home price inflation has slowed since July, when the number rose 16 percent from a year earlier.
The number of homes for sale is also up 50 percent since April, according to real estate membership body Propertymark.
Slower growth: House prices rose 13.6% in August, below July when they increased 16% year-on-year according to the ONS
Iain McKenzie, chief executive of The Guild of Property Professionals, said: ‘You’d be forgiven for assuming that the political and economic turmoil we’ve seen in recent months would have a bigger and more immediate impact on house prices.
“The reality is that house prices depend on a variety of factors, including the supply of and demand for housing, and the effects often take time to manifest.
“These numbers show that there is a slight cooling in year-on-year growth, but it is far from a blizzard.”
He added that the housing market had been reassured by the fact that the stamp duty changes announced in the mini-budget were among the few policies not subject to a U-turn in recent days.
Jeremy Leaf, North London estate agent and former RICS Residential Chairman, added: “The slightly historical nature of these comprehensive figures demonstrates the strength of the property market before it crashes at the end of September.
“Since then, activity has slowed and prices have softened a bit, but there’s still plenty of pent-up demand, particularly to take advantage of existing favorable mortgage rates before they go higher.”
Yet since the former chancellor’s mini-budget last month, mortgage rates have been rising rapidly.
Earlier this week, the average fixed rate for a two-year fixed mortgage on all loans to value rose to 6.53 per cent, the day after new Chancellor Jeremy Hunt rowed out much of the government’s tax cut package. .
The average rate for five-year fixed deals also rose to 6.36 percent, despite dipping slightly to less than 6.30 percent late last week, according to financial information service Moneyfacts.
The last time the average two-year fixed-rate mortgage hit 6.4 percent or higher was in August 2008, in the aftermath of the global financial meltdown, when it hit 6.94 percent.
Those who need a new mortgage can access updated rates based on their own circumstances using This is Money’s mortgage calculator.
Increase in interest: The price of fixed-rate operations has continued to rise since the end of last year, but it has accelerated since the government’s mini-budget
More homes on the market
Propertymark figures show that since April, the number of homes for sale per real estate agency has risen from 20 to 30. This is the highest level since March 2021 when it stood at 31 per member branch.
It was reported today that inflation was 10.1 percent in September, but despite rising interest rates and rising cost of living, Propertymark said there was still demand to move.
The number of registered buyers at each branch also increased.
However, the agents reported that since April, more than half of the sales (52 percent) have been completed below the asking price, suggesting that some of the interest is coming from the market.
Since April, the number of homes for sale per Propertymark member realtor branch increased from 20 to 30, an increase of 50%.
The increasing housing stock on the market has meant that supply and demand have begun to rebalance after a period of high demand that has contributed to continued rise in house prices despite tumultuous conditions.
However, 48 percent of properties are still being completed at or above asking price, which means there is still some way to go to reach pre-pandemic levels. Between 2015 and 2020, 78 percent of sales were below sale price.
Nathan Emerson, CEO of Propertymark, said: ‘During August and September, we have seen an increase in the number of people wanting their homes to be valued and sold. This is great news for shoppers who have been lost before.
“With the changing economic climate, sellers will need to be realistic about the prices they could achieve, but since most people move every 15 years, they still see a significant increase in value from what they would have paid.”
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
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