House prices in the UK went up by 9.5% on an annual basis in September, show figures from the Office for National Statistics (ONS).
“Which sounds great,” says Hargraves Lansdown senior pensions and retirement analyst Helen Morrissey, “but when you compare it to the 13.1% and 15.2% recorded from August and July, we can see the market is starting to slow.”
The ONS adds that prices were static between August and September.
The average property price in the UK now sits at £294,559.
Specifically, house prices in England rose 9.6% on the year, taking the average property price to £314,278 and in Wales, house prices saw a 12.9% annual rise, laving the average house price at £223,798.
Meanwhile, in London, a 6.9% annual rose left the average house price at £544,113.
On a monthly basis, prices in England failed to move, in Wales they increased by 2% and, in London, house prices dropped by 0.6%.
Garrington Property Finders chief executive Jonathan Hopper says: “This was the moment the oil tanker turned. Monthly house price rises evaporated entirely in September after the disastrous, short-lived mini-Budget sent interest rates soaring and shockwaves through the property market.
“Gone are the days of house values marching thousands of pounds upwards every month. The official ONS data shows the price of an average home stagnated in September, but on the front line we saw prices begin to fall in many areas.
“At 9.5%, the annual rate of price growth still looks implausibly high. But it does at least give a measure of how fast things are changing. Just two months ago it stood at 15.2%, and the coming months are set to see it fall further as the market enters a period of intense rationalisation.”
And Fine & Country managing director Nicky Stevenson comments: “The mini-Budget towards the end of the month sparked unprecedented volatility in the mortgage market, something which will become more apparent in the months ahead.
“All eyes will now turn to chancellor Jeremy Hunt’s Autumn Statement, which is expected to include both tax rises and spending cuts.
“Changes to capital gains tax allowances could have an adverse impact on the buy-to-let sector at a time when many landlords are already exiting, and potential new entrants are finding the benefits no longer outweigh the uncertainty.
“A private rental sector in retreat would mean a deepening accommodation crisis across the regions and spiralling rents for tenants.”
Meanwhile, UPSTIX chief operating officer Phil Tennant says: “Partly because it lags other market data, the official figures are yet to record a significant dip. It is all but inevitable however – forecasters only disagree on the timing and extent of the fall. But right now, the biggest problem for the housing market in the immediate term is fall throughs.
“Our own research found that the number of deals collapsing doubled between September and October, which is a problem that will only get worse. Ultimately this hamstrings the sales process, increasing already long lead times, and is a destabilising factor for the wider market.
“What consumers need now is certainty, particularly for those already engaged in transactions. Property technology and instant buying firms offer a lifeline to those who fear their own transaction chain may break.”
