Weekly Property News Round Up – 15.06.24

Welcome to this week’s edition of our Property News Roundup! We’re here to bring you the most current and insightful updates in the property market. In this issue, we delve into Savills’ June 2024 UK Housing Market Update, highlighting a modest growth in house prices despite high borrowing costs and stable mortgage rates.

We’ll also explore strategies for first-time buyers to navigate the tough property market, amid rising affordability challenges and shifting demographics. Finally, we examine the latest property market predictions, discussing the potential for further house price declines and the impact of economic uncertainty and inflation on mortgage rates.

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Now, let’s have a look at the latest headlines that have caught our eye this week…

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Property News This Week

Savils UK Housing Market Update – June 2024

House prices grew by 0.4% in May, taking annual growth to 1.3%, according to Nationwide. This return to monthly growth, following two months of price falls, suggests the market has been resilient in spite of the ongoing high cost of borrowing.

Whilst price growth will remain muted until there are additional mortgage rate cuts. Mortgage interest rates have been relatively unchanged in recent weeks in spite of a slight increase to swap rates. This stability has given some reassurance to buyers, but lower rates will be necessary to bring more demand back to the market.

Finally, Lower mortgage rates are dependent on base rate cuts. Inflation data for April was higher than many economists expected, at 2.3% according to the ONS. This has delayed expectations of the first base rate cut by the Bank of England (BoE). Oxford Economics now expect this to come in August, rather than June, with just one additional cut in 2024.

H ow Can First-Time Buyers Get Ahead In The Tough Property Market

The affordability squeeze on potential first-time buyers appears to be dampening some people’s hopes of ever getting onto the property ladder.

A recent survey for Barclays found that less than a quarter (22%) of 18 to 34-year-olds believe that home ownership is a realistic goal. Meanwhile, according to Santander’s customer data from the first quarter of 2024, a fifth of people taking their first step on the property ladder are aged over 40.

Will UK House Prices Fall? Latest Property Market Predictions Explained

UK house prices have been on something of a journey over the past two years. After hitting a record high in August 2022, they plummeted in the wake of Liz Truss’s disastrous mini-Budget. Prospective buyers abandoned the housing market as interest rates on mortgages shot up, competition between lenders temporarily collapsed, and the value of cash deposits was eroded by record inflation.

Mortgage rates soared again in mid-2023 and recently crept up once more as markets have continued to question the UK’s ability to bring inflation down. There was also uncertainty about when the Bank of England would halt its cycle of Base Rate hikes – a key factor in setting mortgage rates.

That concludes this week’s updates. If you have any thoughts or questions about these headlines, feel free to reply—I’d love to chat with you about the latest market trends and discuss your investment goals.

I’ll be back next week with more insights on the property market. Enjoy your weekend!