Autumn housing market will see a “settling” after “extraordinary” growth
The Autumn housing market will see a settling of the extraordinary growth seen so far this year but demand will remain strong as supply issues continue into the Winter months according to the August reallymoving House Price Forecast.
The forecast reports conveyancing quote volumes returned to more normal levels for the time of year last month and remain unchanged in August, further indicating that buyer demand is settling back down.
Conveyancers remain buoyant despite the stamp duty giveaway working its way out of the system as the availability of the record mortgage deals alongside the limited supply of new property coming to market and new flexible working arrangements continues to drive demand.
It is forecasted that completed house prices will increase by +0.7% over the next three months (September to November 2021) based on deals agreed this summer. House prices will dip marginally in September (-0.5%) as a result of deals agreed in June, when buyers were forced to factor in the cost of paying stamp duty once again, constraining budgets.
However, this dip was short-lived with prices agreed between buyers and seller rising again once the stamp duty holiday deadline passed – likely to be in part due to limited supply of new properties coming onto the market creating greater competition for homes. When those deals complete in October, prices will rise by +1.3%, before flattening out to -0.1% growth in November when the average house price will be £341,492.
reallymoving’s forecast comes as RICS released their own survey in August which identified a continued deterioration in the flow of listings coming to the market and a dip in sales agreed for a second month running. They predict a similar stabilisation going forward.
Rob Houghton, CEO of reallymoving, comments:
“The rate of house price increases over the last year has been remarkable but it’s been a difficult period for First Time Buyers and we welcome a return to more stable levels of growth. The housing market is in good shape heading into the autumn as the impact of the stamp duty holiday works its way out of the system, demand returns to more normal levels and once again the market proves its underlying resilience.
“Competition among cash-rich mortgage lenders has reduced borrowing costs to record lows, alongside a strong economic recovery and jobs market – all of which are boosting consumer confidence and prompting people to make their move now and take advantage of five-year fixed rate deals available at less than 1%. While interest rates stay low and supply remains constrained, despite monthly fluctuations the overall market trend will be steadily upwards.”