The mortgage sector has reacted positively to the latest house price data.
The Halifax says UK house prices finished 2024 up 3.3% over the past year, with the average house price now at £297,166.
Prices actually fell back slightly in the single month of December, by 0.2%, following five consecutive monthly increases.
Amanda Bryden, Head of Mortgages at Halifax, says: “The housing market was broadly steady at the start of 2024, with house price growth taking off from the summer onwards. In the latter half of the year, house prices grew in response to the falls in mortgage rates, alongside income growth, both leading to financial pressures somewhat easing for buyers.”
Sara Palmer, distribution director at The Mortgage Lender, comments: “As expected, December is a quieter month with people taking time off house-hunting for festivities, this is reflected in a slight month on month decrease in house prices after five consecutive monthly increases. Predictions are also for a busy first few months of 2025 as prospective home-owners race to complete house purchases before the relief ends.
“These are positive signs that the mortgage market will lead 2025 with its best foot forward. The hold on December’s interest rate suggests that mortgage rates will fall in the coming months, which will come as good news to those looking to buy their first property or who are coming off fixed-rate mortgages in the near future.”
Tomer Aboody, director of specialist lender MT Finance, says: “As mortgage rates came down throughout last year, we have seen a corresponding rise in prices and activity in the housing market, as confidence and affordability enables buyers to take the plunge.
“With tax changes coming in 2025, along with stamp duty amendments brought in by the new Chancellor, the forthcoming year may be sightly different as buyers could be more cautious. We are hoping for some of the feel-good factor from 2024 to carry on in this forthcoming quarter, with sellers coming to market and increasing volumes.”
And Chris Baguley, group channel development director at Together, adds: “With the new stamp duty increases coming into effect this April, the anticipated flurry of property sales may trigger real action in the market with new buyers flooding in. Together’s own Residential Property Market Report indicates nearly one in five homeowners are looking to move in the next 12 months, so the appetite is clearly there.
“Those eager to move forward with their plans should explore the range of financial products and schemes available. First-time buyers can look at taking advantage of Shared Ownership, and for those looking for fast and flexible finance to jump on an opportunity, there is the option of bridging loans.”
But Amanda Bryden from the Halifax cautions that while the housing market has been supported in recent months by falling mortgage rates, income growth and the announcement on upcoming Stamp Duty policy changes, mortgage affordability will remain a challenge for many.
This will be especially so as the Bank Rate is likely to come down more slowly than previously predicted.
She continues: “However, providing employment conditions don’t deteriorate markedly from a more recent softening, buyer demand should hold up relatively well and, taking all this into account, we’re continuing to anticipate modest house price growth this year.”
