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Prices up 0.1% in October, says Nationwide, "but this may be the last rise we see during the rest of 2024 following the Budget"

ended 01. November 2024

UK house prices rose 0.1% month on month in October, while the annual growth rate slowed to 2.4%, from 3.2% in September, according to the Nationwide. Newspage asked experts for their views on the house price data, which can be found below.

 

10 responses from the Newspage community

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Ben Perks
Managing Director at Orchard Financial Advisers
The optimism of weeks gone by is fading. House price growth has slowed to a trickle and the chances of a base rate reduction are dwindling. How markets react over the next few days will determine the trajectory for 2025.
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Craig Fish
Director at Lodestone Mortgages
The lead-up to the Budget cooled the property market, but the actual announcement has turned on the deep freeze. With inflation down, a base rate drop to 4.75% in November is still likely, but Britain is now left with a serious Budget hangover and the recovery won’t be quick. Rachel Reeves’ actions suggest a misunderstanding of her role, and the markets might show her that actions have consequences. The UK property market is resilient and will bounce back, but once again, it’s lost some serious momentum.
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Darryl Dhoffer
Founder at The Mortgage Geezer
The Budget has transformed the property landscape overnight and further house price growth this year is now unlikely. Expect Threadneedle street to hold its hand on any further base rate reductions until the short-term inflation injectors that Labour have ignited run out of fuel.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
House prices may have risen very sightly in October but this may be the last rise we see during the rest of 2024 following the Budget. The property market has been firing for a number of months now as mortgage rates dropped, which boosted confidence and really started to boost transaction levels. The Budget has holed that confidence under the waterline and the fallout is already clear. Yesterday, the markets delivered their verdict and it was that they do not like it one bit. Many prospective buyers are now assessing how they will be impacted by the Budget and how it will affect their buying and spending power. A few days ago it was looking like we'd have a confident and busy end to 2024 but now it looks set to be hesitant and muted. The stamp duty deadline may drive a number of transactions in the first quarter of the year but many people may simply not have the confidence to move forward with their plans.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
House prices narrowly remained in the black during October as pre-Budget uncertainty gripped the nation. Though the Budget will not have helped the momentum that has been building, the dust will settle and it shouldn't be any more than a pot-hole in the road. As 2024 edges to a close and with further base rate reductions in the months ahead, things are ready to take off in 2025. This hasn't been a great week but if it's anything the property market is resilient.
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Daniel Hobbs
Managing Director at New Leaf Distribution
The slowdown in the annual rate of house price growth last month looks set to continue after the Halloween Budget. As mortgage rates began to edge down during the summer months, demand for property really picked up and that continued during September and October. This was highlighted by the fact mortgage approvals in September were at the highest level since August 2022, the month before the infamous mini-Budget. Last month there was a degree of mortgage rate turbulence ahead of the Budget but demand remained strong overall. However, the Budget may have thrown a giant fiscal spanner into the works. We are already hearing from many brokers that transactions are falling through due to increased stamp duty and following the reaction from markets yesterday it looks like rates may now stay higher for longer as gilt yields rose sharply. A rate cut that was almost guaranteed next week may no longer be coming.
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Andrew Montlake
Managing Director at Coreco
The Nationwide seem to be more optimistic than many others, as they expect the economy to continue to recover steadily. Speak to business owners and they may well have a different view altogether after this week's sledgehammer Budget. The momentum in the property market that has been growing for a number of months now has taken a knock after the Budget, but there are still reasons to expect a busy market. Though it's not on a par with the mini-Budget sell-off, the markets do not like it one bit and that may well have taken a rate cut next week off the table. Sentiment is everything in the property market and this has taken a turn for the worse. That said, with stamp duty set to change to the detriment of first-time buyers in the next tax year, the busy end to the year we had all hoped for may not be as muted as it could have been by the impact of the Budget on people’s finances.
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Riz Malik
Independent Financial Adviser at R3 Wealth
Even with the post-Budget bond market volatility, we should still see a cut in the base rate in November, which could spark further activity in the housing market. However, Rachel Reeves' Budget has knocked the stuffing out of many people and it’s going to take them time to recover. This week the government made it clear they do not understand the UK housing market. That or they simply don’t care.
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Rohit Kohli
Director at The Mortgage Stop
The fall in mortgage rates in recent months spurred on demand from buyers in October but since this week's Budget borrowers have become much more cautious, which is hardly surprising. Nerves ahead of the Budget likely triggered the slowdown in house price growth and now we have the real results in and they're not great. We should still get another base rate cut in November but demand in the next few months may plateau until the dust fully settles on the changes made on Wednesday.
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David Stirling
Independent Financial Advisor at Mint Wealth
What a difference a week makes. The biggest impact on property transactions right now is going to be the immediate hike in stamp duty to 5% for second properties announced in the Budget this week. This is going to stifle the buy-to-let market further and cause many current property sales to potentially collapse. As Robert Gardner from Nationwide says, the housing market has remained resilient, with high mortgage approvals in spite of this period of higher interest rates. There will be a clamour to get completions over the line before March 2025 when the stamp duty exemption rates drop, dragging many transactions that would be SDLT-exempt into the net of the new rules. This should hopefully lead to some competition from the lenders and a strong start in the housing market in 2025 with a probable lull in moves into the spring and summer.