House prices are projected to rise again in September, as the persistent desire to own a home fuels market growth, according to property expert Jonathan Rolande. Rolande, founder of House Buy Fast and lead spokesman for the National Association of Property Buyers, highlighted that despite looming economic challenges, the market shows no sign of slowing down.
House prices set to increase
Jonathan Rolande predicts a “small but important increase” in house prices this month. He attributes this to savvy buyers who are purchasing properties in anticipation of an interest rate reduction, which is expected to accelerate price growth further. “Recent wage growth will also have a positive effect,” he noted, emphasising the role of economic factors in the market’s continued momentum.
Rolande explained that the “seemingly insatiable desire to own a home” has been a significant driver behind the rising prices, marking the fifth consecutive month of growth. He pointed out that the availability of mortgages at lower rates has played a crucial role, with mortgage approvals reaching a two-year high and some rates dropping below 4% for the first time this year.
A balanced market, but supply issues persist
Despite the overall positive outlook, Rolande cautioned that buyer confidence remains fragile. “Buyers are being far more selective about what they buy and will walk away from properties that have issues or are overpriced,” he said. This trend, he noted, is a shift from the post-pandemic boom when buyers were less discerning.
The market, according to Rolande, is currently “quite well balanced,” with neither buyers nor sellers holding all the power. However, the ongoing lack of property supply continues to be a significant issue. This situation has been somewhat alleviated by landlords selling off rental properties to avoid upcoming tax and regulation changes, but the supply remains tight.
Price growth expected to continue
Looking ahead, Rolande suggests that the exodus of landlords from the market may continue until interest rates fall, making it more viable to retain buy-to-let properties. This could lead to a greater shortage of properties in the future, further fuelling price increases.
Reflecting on the broader economic context, Rolande noted, “The new Government has settled in, the honeymoon phase is over, and we now need to listen carefully to see in which direction we’ll be taken.” Despite the “downbeat” tone from the Government, he believes it will take more than words to dampen the property market, given the enduring British desire for homeownership.
Recent data supports Rolande’s analysis, showing that house prices have risen by 1.4% over the first seven months of 2024. While price inflation remains slightly negative in southern England, London has seen a modest increase of 0.2%. The market remains price-sensitive, with one in five homes having their asking price reduced by 5% or more, and overpriced properties taking significantly longer to sell.
Overall, house prices are on track to be 2.5% higher over 2024, with an estimated 1.1 million sales, underscoring the ongoing strength of the UK property market.
