What’s Happening In The UK Property Market – October 2022
Mortgage rates, house prices and average rents have hit new highs, while stamp duty has been cut in the government’s mini-budget (one of the few changes to remain after Kwasi Karteng’s sacking and the appointment of Jeremy Hunt as the new chancellor), and a property with a place in TV history is on the market! Read on for all this and more in your October property market update.
Mortgage rates hit new 14-year highs
New figures have revealed that fixed-rate mortgages are at their highest levels for 14 years, with hundreds of thousands of homeowners facing a steep increase in monthly repayments when their current fixed rates finish in the coming months.
Average fixed rates for two and five-year mortgages are currently at 6.65% and 6.51% respectively, with interest rates expected to rise again in November to try and curb inflation, which is currently at 10.1%.
The sharp increase in rates is partly due to the government’s mini-budget announcement in September, which sent the financial markets into a frenzy, but with most of those policies having since been reversed and with a new government set to be in place by the end of October, there’s some hope for mortgage holders that rates may drop again.
House prices hit new high again
Despite rising interest rates, inflation and cost of living increases, average asking prices have risen to a record high in the UK.
Figures released by property website, Rightmove, have revealed that the average asking price in October was £371,158, a small increase on the previous month.
While the increase might be a surprise to some given the current economic climate, demand for property continues to outweigh supply, giving sellers confidence they can achieve their full asking price.
Asking prices are predicted to drop slightly in November and December, in line with seasonal demand, however, predicting prices for the new year and beyond is impossible for forecasters due to the current political and economic uncertainty in the UK.
Stamp duty cuts are here to stay…for now!
In welcome news for home-buyers, and particularly first-time buyers, the government’s recent changes in stamp duty have been confirmed by the new Chancellor.
As part of the government’s mini-budget on 23rd September, then-Chancellor Kwasi Kwarteng announced a raft of tax cuts, many of which have since been reversed by his replacement, Jeremy Hunt.
However, the change in stamp duty was one of the only cuts to be kept in place. The change means that stamp duty tax isn’t payable on properties over £250,000 – an increase on the previous threshold of £125,000. For first-time buyers, the threshold for paying stamp duty is £425,000.
The changes mean that movers will save up to £2,500, while for first-time buyers the savings can be as much as £11,250.
Since the new Chancellor’s announcement that stamp duty changes would be kept, Prime Minister Liz Truss has resigned, so there may be another shift in policy when a new government is announced in the coming weeks.
Average London rents hit new highs
Rents in the capital have hit new highs, with the average property costing £553 per week. The previous high was set in June when prices hit £549 per week, and data from various estate agents in the capital suggests that each property has 29 renters competing for it on average.
This soaring demand has led to bidding wars, auctions, and even demands of up to 12 months’ rent in advance from some landlords.
The increase in demand can be attributed to a number of factors, including a return to city living post-COVID, and a rise in the number of renters delaying buying plans as they wait for volatile mortgage rates to settle down.
Own a piece of British TV history
If you’re a TV sitcom fan and in the market for a new property, you might want to take a look at the picturesque village of Turville in Buckinghamshire for your next home.
That’s because a pretty two-bedroom cottage has gone up for sale, which was used as the primary setting for The Vicar of Dibley.
The show, which starred Dawn French, was one of the most popular sitcoms in the UK between 1994 and 2007, and the cottage featured prominently throughout the show’s 20+ episodes.
Other scenes from the show were also filmed around the village, which has also been used as a filming location for major shows like Goodnight Mr Tom, Midsomer Murders, Killing Eve and Chitty Chitty Bang Bang.
The cottage has an asking price of £695,000, and you’ll find all the details here.
For more property news and updates and a more detailed overview of the East London area, get in touch with Lyss Homes. We are your local property experts. Call us on 02080505452 or email info@lysshomes.co.uk.
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