Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
Home Finance Hopes for a soft landing for housing market after months of turbulence

Hopes for a soft landing for housing market after months of turbulence

by uma

 

  • Between January and August, the average UK house price increased by almost £20,000, from £255,556 to £273,751.
  • A 10% deposit on the typical mortgage on a first-time buyer property increased to almost 60% of annual gross earnings – an all-time high.
  • Increasing mortgage rates in the aftermath of the mini-budget pushed up mortgage payments and affected market confidence.
  • According to Nationwide, house prices saw three successive monthly declines since September – the worst run since 2008.
  • However, there are hopes for a relatively soft landing with price declines of around 5%.

Nationwide has released a housing market review as well as a forecast for 2023.

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown:

“Today’s data shows the remarkable resilience of the UK housing market for much of the year with strong house price growth and activity continuing even in the face of growing economic headwinds. Many wondered how long this could continue and the end when it came, came abruptly. The aftermath of the mini-budget brought the market to a screeching halt with providers pulling deals off the table and mortgage payments heading skyward.

It has truly shaken confidence, with would-be buyers now increasingly hesitant to come to market – a fact confirmed by recent data from the Building Societies Association (BSA) showing housing market sentiment close to all-time lows.

As the economic gloom darkens with impending recession it’s unlikely we will see people rushing back into the market in their droves any time soon – again the BSA data showed even higher earning households increasingly worried about their bills and affordability of mortgage payments is seen as the main barrier to property purchase – even more so than saving increasingly huge deposits.

However, there still seems to be hope for something of a soft landing as we head into the New Year. The expectation is that the recession will not result in mass redundancies and that fixed rate mortgage deal rates may have peaked. With luck this can tempt people back into the market and support activity with prices edging down modestly rather than any kind of crash. This should come as some comfort after what has been a truly terrible year for many.”

 

Recent Post