A look at the economic factors affecting the UK house prices in August 2022.
First some macro-economic issues taking effect on the market.
- The month of August is usually relatively quiet in the property market as people take the opportunity to go on holiday.
- New Prime Minster in place – uncertainty as to new policies and their affect on interest rates and house prices.
- CPI inflation in the UK in July increased slightly to 10.1%, which is the highest rate it’s been for 40 years. It has been predicted to go to around 13% in the next few months.
- The Bank of England (BOE) has kept interest rates at 1.75%.
- For May to July 2022 the jobs market weakened a little, albeit from a position of strength. The number of vacancies fell slightly to 1,274,400, which is the first fall since August 2020.
July and August are traditionally quieter times in the property market as people go on holiday. This is especially true in 2022 as foreign holidays have been restricted for the past two years. This means less properties are put on the market and there is less buyer activity.
The Halifax and Nationwide both produce a house price index. Their figures tell us house prices in the UK rose in August 2022 by 0.4% and 0.8% respectively. The annual rate of growth eased but still stands at a health 11.5% according to the Halifax and 10% from Nationwide.
Read the full data from Halifax and Nationwide.
James Raspin, Chief Surveying Officer at Survey Hut commented on the figures:
“If you watch or read the news you’d think the world is coming to an end. In the real-world people still need to move and are confident they can pay their mortgages.”
“The shortage of housing stock on the market is helping to keep prices high. We are surveying and valuing homes where there has been multiple bids and prices continue to be agreed above asking prices.”
“The real test of the market will come once the full effect of the increased energy prices comes into play and disposable incomes come under pressure.”
“All in all, we think there might some easing of house price rises towards the end of 2022, but we don’t believe we are likely to see any significant price drops.”
Get in contact with Survey Hut for residential valuations and pre purchase surveys.
