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Thursday, October 28, 2021

Rapid house price growth continues in September, says Nationwide

IDBS ART GALLERY

Annual house price growth of 10% or more has been recorded for each of the past five months, according to data from the Nationwide.

According to the UK’s largest building society, prices were up 10% year on year in September, a slight slowdown from 11% in August.

According to the lender, the double-digit increase was driven by recent activity in Wales and Northern Ireland, with London still experiencing the slowest growth.

The average house now costs £248,742.

Rapidly rising house prices continues to create financial problems for potential first-time buyers, despite record low mortgage rates being offered by lenders.

A recent report by the Office for National Statistics (ONS) said that people in tourist hotspots – which have become increasingly popular for relocating buyers – were at risk of being priced out of buying a home in the areas where they worked.

Nationwide bases its house price estimates on its mortgage data, and Robert Gardner, the building society’s chief economist, said that property values had continued to rise more quickly than earnings, which meant affordability was becoming more stretched.

“Raising a deposit remains the most significant barrier for the majority of prospective first-time buyers.” “A 20% down payment on a typical first-time buyer home is now around 113 percent of gross income – a record high,” he said.

“First-time buyers have been completely caught off guard over the last year as the market has taken off,” said Karthik Srivats, co-founder of mortgage lender Ahauz.

“Their budgets have been hammered in real terms, and while they have been helped by low rates and government support over the past year, gains in property values across the country have more than offset that boost.”

The stamp duty threshold in England and Northern Ireland will revert to normal levels on Friday, following a temporary holiday last year, before being gradually reduced beginning in July this year.

In June, there was a frenzy of activity as buyers rushed to complete their purchases before the deadline.

SourceBBC
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