Updated: Jun 9, 2021
5 months into the year and house prices are still rising….fast. The looming stamp duty holiday deadline, low housing supply, low interest rates and seasonal market positivity have collectively contributed towards house prices rising at the fastest rate in 7 years.
There is still no real sign of this market cooling down.
HOUSE PRICES - UK House Price Index (March 2021)
The UK HPI is based on completed housing transactions. Typically, a house purchase can take 6 to 8 weeks to reach completion. Therefore, the price data feeding into the March 2021 UK HPI will reflect sales agreed in January.
- Average Price UK £256,405 - March 2021
- Annual Price Change 10.2% - March 2021
- Monthly Price Change 1.8% - March 2021
- London Average Price = £500,310 - March 2021
- London Annual Price Change = 3.7% - March 2021
- London Monthly Price Change = -1% - March 2021
HOUSE PRICES - HALIFAX HPI (June 2021)
The Halifax HPI provides us with more recent house price data (from mortgage approvals)
The Halifax House Price Index is the UK's longest running monthly house price series with data covering the whole country going back to January 1983
The Halifax uses its own database of approximately 300,000 mortgage approvals per annum (ca. 25% of all mortgages) as a basis for its monthly house price reports. Because it uses approved loans rather than completed mortgages, the Halifax can obtain data earlier than the Land Registry
- Average Price: £261,743 - May 2021
- Annual Price Change: +9.5% - May 2021
- Monthly Price Change +1.3% - May 2021
TRANSACTIONS (March 2021)
(Transactions involving the creation of a new register, such as new builds, are more complex and require more time to process)
- Estimated number of UK residential transactions, 117,860 - April 2021
- Annual Transaction Volume Change = 178% increase - April 2021
- Monthly Transaction Volume Change = 35% decrease - April 2021
RENTAL INDEX MARKET (May 2021)
Data is gathered from our tenant referencing service, and our rental amounts are based on actual achieved rental prices with accurate tenancy start dates in a reported month, rather than advertised costs (HomeLet)
- Average rent in UK = £997
- Annual Variation for the UK = +4% (year on year)
- Average rent in London = £1583
- Annual Variation for London = -1% (year on year)
- Household Rent To Income Ratio UK: 30%
- Household Rent To Income Ratio UK: 34%
“We’ve seen from sharp house price spikes across the country that the Coronavirus pandemic changed what Britons are looking for in a property. Many said to be looking for properties offering more living space; for those working from home as an example, that’s also the case in the private rented sector.” - Homelet
- Data from Moneyfacts shows that as of the start of June 2021, there were 4,243 mortgages for potential borrowers to choose from, up from 3,927 at the start of May 2021.
- In June 2020, there were just 2,810 mortgages on the market.
- As well as choice improving overall, the number of 95% LTV mortgages on the market increased from 112 in May to 192 in June.
- Over the course of the past month, 33 new two-year fixed rate products were launched [at 95% LTV], seeing the average fixed rate drop by a substantial 0.14% [since May] to 3.88%.
- At 60% LTV, the number of products available has edged up from 527 in May 2021 to 534 in June 2021. This compares to 545 products on the market in June 2020.
- As well as changes in the top LTV tiers, rate competition has become evident at the opposite extreme of the LTV spectrum, with a number of lenders launching eye-catching sub-1% mortgage deals in the lowest LTV brackets
- These record-low rates are available to low-risk borrowers with high levels of equity, but as to whether this competition will extend to higher-LTV deals remains to be seen as we navigate the full economic impact of the last year.
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