No I’m not talking about the E.L. James novels and their risqué subject matter.
I’m talking about the state of the housing market. Are thinks good or bad, up or down, in or out (ahem), black or white. Well according to the data coming out this month it is somewhere in the middle, with very much a grey feeling.
Some key takeaways:
- According to Halifax’s house price data, average house prices were up by 1.1% in February and up by 2.1% on an annual basis.
- Conversely Nationwide Building Society data points to an average price drop of 0.5% in February and the annual house price growth turning negative to -1.1% for the first time since June 2020. According to Nationwide prices are now 3.7% below August’s peak (seasonally adjusted).
- Just to sum up the conflicting data asking prices in February were flat according to Rightmove. This is the smallest increase from January to February they’ve ever seen. There is a better balance between the number of sellers and buyers which is slowing the market, the number of available homes is up by 48% compared to the lows of last year.
- The Bank of England (BOE) increased the base rate from 3.5% to 4% in early February. This put the base rate at its highest point since 2008. It will be interesting to see what the BOE does at its next review of the base rate at the end of March.
- The best mortgage rates on the market at the moment are around 4% for 2 and 5 year fixed rates. This is down significantly from the highs of 6.5% in October 2022.
The ‘grey’ state of the housing market and economy should be seen as a positive.
Most commentators predicted steep price drops and a shrinking economy in 2023. The prevailing data, including mortgage interest rates and the limited house price drop, has been better than predicted. This should lead to an increase in consumer and business confidence that things aren’t as bad as thought and encourage more to undertake significant changes, such as moving house.
If you are a first time buyer looking for advice on a home survey or an experienced home mover looking for peace of mind on your next purchase, get in contact with Survey Hut.
