September has seen the fastest annual house price growth in around two years, according to an index. UK house prices increased by 0.7% in September, Nationwide Building Society said. This resulted in the annual price growth rate accelerating from 2.4% in August to 3.2% in September, the fastest pace since November 2022 when there was a 4.4% rise. The average UK house price in September is £266,094. Property values in Northern Ireland performed the most strongly for annual growth in the third quarter of this year, with prices up by 8.6% year-on-year, Nationwide said. East Anglia was the weakest performing region, with prices down by 0.8% over the year.
Robert Gardner, Nationwide’s chief economist, said: “Average prices are now around 2% below the all-time highs recorded in summer 2022.” He also mentioned that “income growth has continued to outstrip house price growth in recent months while borrowing costs have edged lower amid expectations that the Bank of England will continue to lower interest rates in the coming quarters.” The trends have improved affordability for prospective buyers and underpinned a modest increase in activity and house prices, though both remain subdued by historic standards. Scotland saw a noticeable acceleration in annual growth to 4.3%, Wales saw a more modest 2.5% year-on-year rise, and across England overall, prices were up 1.9% compared with the third quarter of 2023.
Northern England continued to outperform southern England, with prices up 3.1% year-on-year. The North West region was the best performing English region, with prices up by 5.0% year-on-year. London remained the best performing southern region with annual price growth of 2.0%. Nationwide’s most recent data by property type showed that terraced houses had the biggest percentage rise in prices over the past year, with average prices up by 3.5%. Semi-detached and flats saw increases of 2.8% and 2.7% respectively, while detached houses recorded growth of 1.7%.
Sarah Coles, head of personal finance at Hargreaves Lansdown, commented on the positive price rises, stating that they are not “runaway” price rises but firmly positive, contributing to buyer sentiment. Various industry experts like Iain McKenzie, chief executive of the Guild of Property Professionals, and Guy Gittins, chief executive of Foxtons estate agent, expressed optimism about the market activity and housing sales. Verona Frankish, chief executive of Yopa, highlighted that while buyers are returning with confidence, transactional volumes still lag behind previous levels. Overall, the property market has shown resilience in the face of various economic factors, with house prices increasing at their fastest rate in two years and nearing historic record highs.
Nathan Emerson, chief executive of Propertymark, highlighted the competitive offerings by lenders in response to evolving base rates, while Holly Tomlinson, a financial planner at Quilter, noted the stabilising effect of the Bank of England’s base rate on the market. Matt Thompson, head of sales at Chestertons estate agent, expects the market activity seen in September to continue in October, with sellers likely to review their positions post the autumn budget. Jonathan Hopper, chief executive of Garrington Property Finders, pointed out the regional variations in pace of recovery, with prices rising fastest in more affordable locations and a notable North-South divide based on buyer preferences.
The article also included a breakdown of average prices in various regions in the three months to September and the annual change recorded by Nationwide Building Society. This comprehensive overview of the housing market in the UK portrays a complex yet optimistic landscape, with signs of gradual recovery and resilience despite ongoing economic challenges.