Halifax report shows house price growth increased year on year to October of 9.7% due to improving economic conditions.

Latest figures from the Halifax confirm property prices are accelerating with the average monthly rise of 1.1% and quarterly rise of 2.8%.

The annual rate rise has improved from 8.6% to 9.7% bringing the average price of a property to a new record high average of £205,240.

For home movers wanting to trade up when prices are rising, they may find their next property is more expensive which means they need a larger deposit or mortgage.

Martin Ellis, Halifax housing economist said the imbalance between demand and the continuing shortage of housing supply is likely to persist over the coming months maintaining upward pressure on house prices.

For remortgage buyers the continuing rise in house prices gives them the opportunity to release capital which they can use to improve their home.

House price rise to continue

Martin Ellis has said improving economic conditions and household finances as well as competitive mortgage rates have increased demand for properties this year.

Lower mortgage rates benefit buy-to-let investors as they can remortgage to reduce the cost of interest repayments to lenders.

Strengthening demand is filtering through leading to higher number of sales. The stock of homes available for sale remains at record low levels according to Royal Institution of Chartered Surveyors’ (RICS) monthly report.

With new instructions by home sellers declined in September for the eighth successive month the ongoing shortage of supply is acting as a significant constraint on activity.

The continuing rise in house prices will increase pressure on affordability for first time buyers requiring a larger deposit or higher earnings to purchase their first home.

For home movers, rising prices means the gap between their current home and the next increases so they need a larger mortgage.

Higher property values for older homeowners allows the equity release mortgage buyer to access wealth to consolidate debt, for home improvements or holidays.

Consumer confidence at a high

The Halifax Housing Market Confidence Tracker shows confidence is at a high with over two-thirds (68%) of Britons expecting average property prices to increase in the next twelve months and only 5% expecting it to be lower.

According to the Bank of England, from quarter two to quarter three the volume of mortgage approvals for house purchases increased by 4%.

In addition, the approvals for the quarter to September were 10% higher than the same quarter last year.

The number of homes sold in the UK increased for the second successive month rising 1% to 106,030 between August and September.

Sales in the three months to September were 4.4% higher than in the preceding three months according the HMRC figures.

What are your next steps?

Speak to our LCM mortgage advisers if you are planning to move home, buying your first home, remortgaging your existing home to a new cost effective mortgage deal or are a buy-to-let investor.

For equity release buyers our London City Mortgage brokers can recommend lifetime mortgages allowing you to receive cash from your property to help maintain your standard of living as costs rise.

Learn more by using the mortgage cost calculators, equity release calculator and property value tracker chart. Start with a free mortgage quote or call us and we can take your details.

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