green shoots evident as housing market picks up

Resilience has been the go-to word to describe the housing market in recent weeks as it continues to defy expectations. As we head into spring, and what is traditionally a busy time for the market as properties start to look their best, encouraging owners to put them up for sale, there are indications that buyers and sellers are shaking off concerns about high inflation and volatility in mortgage pricing, and proceeding with their transactions.

After the sharp downturn at the end of last year, sparked mainly by the mini-Budget, there are signs of a market in recovery mode.


house prices continue to rise in all UK nations and regions: Halifax

While the property market is soft, which is being reflected in the data, last month’s calm Budget helped steady the ship. Halifax reported that the average house price increased by 0.8 per cent in March, following a 1.2 per cent rise in February, indicating that values continue to rise albeit the pace of growth is slowing.

A large percentage of potential homeowners, first-time buyers and investors alike have been put off by the considerable uncertainty following the September Budget. The drop in transactional volumes in the second half of last year, according to Bank of England data, suggests that people have been waiting to see what is going to happen. This might not be the best time to sell your property if you have a choice, as most prospective buyers will expect a discount in light of fragile market conditions and the self-fuelling narrative around falling house prices. However, if you are moving up the housing ladder to a more expensive property, you should save more on your onward purchase than you lose on the sale of your existing home, so it all needs to be put into perspective.


pace of house price growth slowing: UK HPI

Although there is a two-month lag with the publication of the Land Registry/ONS house price data, it is regarded as being one of the more reliable sources of information about house prices so is worth looking at. February’s data shows that house prices are still rising on an annual basis although the pace of growth is slowing. This is not surprising as fewer properties for sale tends to result in higher property prices, which seems to have been the case over the past year or so, with demand in the regions and for houses, rather than flats, particularly strong.


rising rents encouraging more buyers onto the housing ladder: Rightmove

Latest figures from Rightmove reveal that asking prices for typical first-time buyer homes have hit a new record high of £225,000, while at the same time annual price growth slowed with prices increasing by 1.7 per cent in the year to April compared to 3 per cent in the 12 months to March.

Rightmove said that record rents are persuading first-time buyers to take the plunge and commit to a property purchase. They are taking advantage of lower mortgage rates in recent weeks, as well as lenders prepared to lend at higher loan-to-values. As rents continue to rise, mortgage payments are proving to be cheaper, making this a sensible move for many in the longer term.

Prices are holding up comparatively well in regional areas due to lower pricing in the first place and better affordability for buyers than in more urban areas. As many buyers have less need to be centrally based as they continue to work from home either full time, or at least some of the time, this trend is likely to continue for the foreseeable future.



Until there is better visibility as to where base rate levels off, and comfort that the cost-of-living crisis and inflation have been contained, the downward pressure on house prices is likely to continue. While there are fewer buyers out there, sellers serious about selling need to price realistically in order to find a buyer and achieve a successful outcome.


how MT finance can help

If you’re looking to take advantage of the soft property market and want to move quickly, MT Finance can help. Our bridging loans have been designed to be fast, flexible and stress-free and we are here to get your short-term loan completed in a matter of days. Not only will this allow you take advantage of a business opportunity but it will also enable you to compete with cash buyers. To find out more, contact our team online, via email or on 0203 051 2331.

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