Table of Contents
- Minimal Change in House Prices
- What Our Data Reports
- Will Interest Rates Come Down in June?
- General Election Impact on Home Sales?
Have House Prices Fallen or Risen? Will the Mortgage Rates fall? – we’ve got you covered! We will deep dive into those questions and more within this in-depth article to help you decrypt June’s Property Market madness this month!
Looks like we are seeing another month of stabilised house prices, which may continue into the summer. Halifax, Nationwide and Zoopla have all released reports related to the current house prices and have stated small changes to house prices from 0.1% to 0.4% going in either direction.
The current mortgage rates may still be playing a factor with house price stability. As everyone maybe preparing for interest rates to drop, which in turn may increase house prices, wee could see the property market pick up, if the rates drop on the 20th June. Currently, the mortgage rates are sitting between 5% and 6% for residential mortgages.
We have dived into our own data to understand what’s been happening in the property market. We are seeing an average completion time from the property to be sold (SSTC) to legal completion of 21 weeks, which is a decrease from the start of year, which was 22 weeks.
Finally, we’ll look further into the affects that the general election might have on the housing market – how will this affect the property market if you look to sell your home?
Minimal Change in House Prices
Latest data has told us house prices have remained stable across the UK over the last few months:
- Halifax reported that property prices are up by +0.1% on a month to month basis in April (£288,959)
- Nationwide reported in May a steady increase of +0.4% in May (£264,249).
- Zoopla reported a month to month decrease in house prices of -0.1% in April (£264,300).
Overall on average we are seeing a steady housing market compared to the last few years. A number of factors could be playing a part, such as; Mortgage rates and buyer demand. MPC (Monetary Policy Committee) will decide on the 20th June whether or not the mortgage rates will remain as they are or decrease. This could in turn then affect the housing market and we could see a lot of potential buyers hit the market, if interest rates decrease. However, if rates stay the same we may see a fractional decrease in house prices, but only time will tell.
We Analyse Our Data
Our data has shown that for an average agreed price (SSTC) to legal completion it takes the home-seller around 21 weeks to fully complete on their property purchase. This indication shows us the current issues in the economy, which are lengthening the time it takes to complete.
Check out our estate agent comparison tool to see which agents can get you property sold efficiently!
Will Interest Rates Come Down in June?
Rhiannon Philips from Moneyfactscompare.co.uk reports that mortgage rates are higher now than they this time last year. The average rate for a two-year fixed mortgage at 90% loan-to-value (LTV) have increased from 5.66% at the start of June 2023 to 6.14% by the end of May 2024. The rate for a five-year fixed mortgage at the same LTV increased from 5.23% to 5.59% during the same time.
Overall, mortgage rates haven’t changed much since last month, staying between 5% and 6%.
Savey minded home-owners will keep their eye on what is to come when Bank of England’s Monetary Policy Committee announce whether or not they will keep the interest rates the same or decrease them. As the inflation rates sits at 2.3%, this could be a good indication whether the MPC steady the ship of interest rates and keeps them the same or whether they think it is the right time to decrease the base rate.
What the Bank of England’s Base Rate Means For Your Mortgage
Most banks and building societies, usually adjust their mortgage rates in accordance with the Bank of England’s interest rates. So if the base rate goes up the mortgage rates will go up, likewise if they decrease.
As stated above we could see a decrease this month, our feeling is that they could remain the same so that inflation does not take an unexpected hike. Although a decrease is what leading economist want, Bank of England may see this as an opportunity to steady the economy and later on in the year begin to reduce the base rate.
Of course, we will keep you up to date on all the news surrounding the Bank of England and what kind of impact this could have on you as and when it all unfolds.
General Election Impact on Home Sales?
On the 22nd May 2024, Rishi Sunak announced that were will be a General Election on the 4th July 2024. A lot of anticipation has been around on what the outcome could be in terms of housing and getting first-time buyers on the property ladder.
Over the years General Elections do not have too much impact on the housing market. So a decision to move home, should not sway your thoughts on this.
However, the base rate decision that will be this month by the MPC will have a bigger impact on the housing market than a general election. Of course each party will have their policies in place on what they can deliver to the property sector. It will be an interesting month to see how each political party will want to shape the market, which will affect homeowners in the decades to come.
