UK Housing Market Reaches Another Record High in September

UK Housing Market Reaches Another Record High in September

As the month of September closed, the data in the housing market began to be compiled and once again the demand from buyers has proved to be astounding. The resilience in the housing market has surprised since the global pandemic took a strong hold on the economy early last year. Month after month the data has shown that demand is strong and that certain factors have caused the opportunity to buy property too good to overlook. According to Halifax, the average house price increased in September by 1.7% which is the strongest monthly increase in 14 years for the month which closes out the third quarter of the year.

The increase of £4,425 brought the average UK house price to £267,587. This is a new record high from Halifax. The previous record was posted in August at £263,162.

The strong demand is being credited to many factors. One of which was the coming deadline at the end of September of the stamp duty holiday. Those that were keen to take advantage of the discount would have done so as soon as possible, and there could have been a strong purchase group seeking to make the deadline and save before the close of the month.

The continued low interest rates are likely the strongest motivator for home buyers. With borrowing from some lenders at historically low levels, it could easily put home ownership on the top of many priority lists. 

On the tops of wish lists have been homes with more space and garden areas. Despite the reprieve from lockdowns, the desire for more space in the home to work privately, to allow children to study and learn, as well as other needs like fitness areas and entertainment areas, is a strong desire. The search for more space inside and green space outside the home has been dubbed the race for space in the housing market.

Even as vaccines have rolled out and a more normal way of life is approaching, the strong desire to buy a more spacious home outside highly populated areas in the countryside has pushed demand from first time buyers and home movers.

Those homeowners that have chosen to stay put rather than move home are also taking advantage of low interest rates. Remortgaging is very popular and many are choosing to cash out their built up property equity and use the money to make improvements and upgrades in their home. It is the homeowner’s desire to turn their current home into one that best suits their pandemic lifestyle that is causing many to reinvest into the property.

The housing market has been forecasted to remain highly active throughout the end of the year. The positive forecast is mainly due to the expectation that the Bank of England’s Monetary Policy Committee will allow the historically low standard base interest rate to remain at 0.1% until early next year. Any expectation of rising interest rates will likely cause a strong boost in the housing market and the remortgage lending market as well.

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