Latest news with #NationwideHousePriceIndex
Yahoo
01-05-2025
- Business
- Yahoo
UK house prices slow in April as market digests stamp duty changes
UK house price growth decreased to 3.4% on an annual basis in April, down from 3.9% in the previous month, mainly due to the effect of recent stamp duty changes and seasonal effects, according to the Nationwide House Price Index. This was below analyst estimates of a 4.1% increase, while also being the softest house price rise since October 2024. On a monthly basis, UK house prices fell 0.6%, which was the first decline since August 2024. In contrast, house prices remained stable on a monthly basis in March. The monthly Nationwide House Price Index came down to 539.3 in April, down from 542.4 in March. Robert Gardner, Nationwide's chief economist, said in the April House Price Index report on the company's website: 'The softening in house price growth was to be expected, given the changes to stamp duty at the start of the month. Early indications suggest there was a significant jump in transactions in March, with buyers bringing forward their purchases to avoid additional tax obligations.' He also noted that the market is expected to stay slightly soft in the near future, given the pattern usually seen after the end of stamp duty holidays. However, this trend is estimated to only be short-term. 'Activity is likely to pick up steadily as summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive.' Low unemployment and rising earnings are expected to support housing activity again in the summer. The Bank of England is also likely to announce further interest rate cuts, which should encourage buyers as well. Pantheon Macroeconomics said in a note: 'The 20-month low in month-to-month house price inflation is an eye-catcher, but we remain constructive on house prices. Bigger picture, we think that strong fundamental demand for housing, weak supply, and steady economic growth will mean that house prices continue to rise in 2025.' However the company pointed out that the ongoing trade war and rapidly changing US policies could cause hurdles for house prices. Sign in to access your portfolio
Euronews
01-05-2025
- Business
- Euronews
UK house prices slow in April as market digests stamp duty changes
ADVERTISEMENT UK house price growth decreased to 3.4% on an annual basis in April, down from 3.9% in the previous month, mainly due to the effect of recent stamp duty changes and seasonal effects, according to the Nationwide House Price Index. This was below analyst estimates of a 4.1% increase, while also being the softest house price rise since October 2024. On a monthly basis, UK house prices fell 0.6%, which was the first decline since August 2024. In contrast, house prices remained stable on a monthly basis in March. The monthly Nationwide House Price Index came down to 539.3 in April, down from 542.4 in March. Robert Gardner, Nationwide's chief economist, said in the April House Price Index report on the company's website: 'The softening in house price growth was to be expected, given the changes to stamp duty at the start of the month. Early indications suggest there was a significant jump in transactions in March, with buyers bringing forward their purchases to avoid additional tax obligations.' He also noted that the market is expected to stay slightly soft in the near future, given the pattern usually seen after the end of stamp duty holidays. However, this trend is estimated to only be short-term. 'Activity is likely to pick up steadily as summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive.' Low unemployment and rising earnings are expected to support housing activity again in the summer. The Bank of England is also likely to announce further interest rate cuts, which should encourage buyers as well. Pantheon Macroeconomics said in a note: 'The 20-month low in month-to-month house price inflation is an eye-catcher, but we remain constructive on house prices. Bigger picture, we think that strong fundamental demand for housing, weak supply, and steady economic growth will mean that house prices continue to rise in 2025.' However the company pointed out that the ongoing trade war and rapidly changing US policies could cause hurdles for house prices.
Euronews
02-04-2025
- Business
- Euronews
UK house price growth stays stagnant in March ahead of stamp duty hike
ADVERTISEMENT UK house price growth remained stable in March, unchanged from February, as buyers pulled back from deals concerned they would not complete before the stamp duty hike from 1 April. According to the Nationwide House Price Index released on Tuesday, on an annual basis, UK house prices stayed at 3.9%. Northern Ireland was the top performing area with annual price growth accelerating to 13.5%, while London was the weakest performing region with a 1.9% year-on-year rise. 'There was no change in prices month-on-month, after taking account of seasonal effects. These price trends are unsurprising, given the end of the stamp duty holiday at the end of March (transactions associated with mortgage approvals made in March, especially toward the end of the month, would be unlikely to complete before the deadline). 'Indeed, the market is likely to remain a little soft in the coming months since activity will have been brought forward to avoid the additional tax obligations – a pattern typically observed in the wake of the end of stamp duty holidays,' Robert Gardner, Nationwide's Chief Economist, said in the report. However, he said that activity is likely to pick up steadily as the summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive. 'The unemployment rate is low, earnings are rising at a healthy pace in real terms (i.e. after accounting for inflation), household balance sheets are strong and borrowing costs are likely to moderate a little if Bank Rate is lowered further in the coming quarters as we and most other analysts expect,' he added. Related UK average house price dips unexpectedly in February as demand slows When does the stamp duty threshold change? The temporary threshold increases to Stamp Duty Land Tax (SDLT) ended as of 1 April 2025. It means that first-time buyers now have to pay stamp duty when buying homes worth £300,000 (€358,467) and above from now on, down from the previous £425,000 (€507,836.8) threshold. For repeat buyers who own only one residential property, stamp duty is nil up to £125,000 (€149,556.9), with the next £125,000 taxed at 2%. Stamp duty is 5% for the following £675,000 (€807,441.8), while the next £575,000 (€687,809.3) is taxed at 10%. The SDLT rate for any amount above £1.5 million (€1.8m) is 12%. Buyers have to pay an extra 5% SDLT on top of these rates, if they own another residential property. How much do properties cost across the UK? For the first three months to March, the average property price in Northern Ireland was £205,796 (€245,986), while the average price in Scotland was £186,131 (€222,503). In Wales, property prices rose 3.6% in the first quarter of this year, with the average house setting buyers back by about £209,839 (€250,839). In England, the North West saw the second highest house price growth in the UK in the first quarter of 2025, at 5.9%, with the North seeing a rise of 4.7%. Property prices rose 3% in the outer South East, with an increase of 5.8% in the West Midlands and a growth of 2.8% in the South West. The average London property cost £529,369 (€632,691.2) in Q1 2025, with house price growth coming in at 1.9%, compared to 2% in the previous quarter. On a monthly basis, UK house prices flatlined in March, compared to a 0.4% rise in February. ADVERTISEMENT Pantheon Macroeconomics said in an email note: 'The 0.0% growth rate for March is the first instance in seven months where the index has failed to rise, though strong gains over the winter in the index still point to healthy increases in the ONS official measure of house prices, which typically lags movements in the private sector indices.' It also noted that no change in the index in March was impressive, given the uncertainty households most likely felt because of the Chancellor's Spring Statement and the looming stamp duty threshold changes. Related Property sector in danger? More countries may follow Spain's tax moves Homebuyers expected to be more cautious in coming months Alice Paine, personal finance analyst at Bestinvest by Evelyn Partners, pointed out that house buyers were likely to be more hesitant to make purchases in the next few months, given the stamp duty increases. 'Homebuyers are likely to weigh up the cost of home ownership very carefully from today. As well as rising transaction costs, they must contend with uncertainty about the wider economy as the country braces for the fallout from the triple hit to businesses this month from rising National Insurance costs, business rates and the minimum wage. ADVERTISEMENT 'Many employers plan to pass on higher costs to consumers, and with a raft of household bills going up from today - from energy to water, council tax and more - budgets are going to get stretched to the max,' she said. Hope for first-time buyers Paine also highlighted that even though borrowing costs may fall if the Bank of England chooses to keep loosening its monetary policy, the economic outlook for the UK is still uncertain. This is mainly because of escalating tariff threats from US president Donald Trump, as well as the potential impact of Chancellor Rachel Reeves' tax increases. However, there may be a silver lining for first-time buyers, as a number of mortgage providers now seem to be easing their lending terms, with a wider range of no-deposit mortgages now available.
Yahoo
01-04-2025
- Business
- Yahoo
UK house price growth stays stagnant in March ahead of stamp duty hike
UK house price growth remained stable in March, unchanged from February, as buyers pulled back from deals concerned they would not complete before the stamp duty hike from 1 April. According to the Nationwide House Price Index released on Tuesday, on an annual basis, UK house prices stayed at 3.9%. Northern Ireland was the top performing area with annual price growth accelerating to 13.5%, while London was the weakest performing region with a 1.9% year-on-year rise. 'There was no change in prices month-on-month, after taking account of seasonal effects. These price trends are unsurprising, given the end of the stamp duty holiday at the end of March (transactions associated with mortgage approvals made in March, especially toward the end of the month, would be unlikely to complete before the deadline). 'Indeed, the market is likely to remain a little soft in the coming months since activity will have been brought forward to avoid the additional tax obligations – a pattern typically observed in the wake of the end of stamp duty holidays,' Robert Gardner, Nationwide's Chief Economist, said in the report. However, he said that activity is likely to pick up steadily as the summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive. 'The unemployment rate is low, earnings are rising at a healthy pace in real terms (i.e. after accounting for inflation), household balance sheets are strong and borrowing costs are likely to moderate a little if Bank Rate is lowered further in the coming quarters as we and most other analysts expect,' he added. Related UK average house price dips unexpectedly in February as demand slows The temporary threshold increases to Stamp Duty Land Tax (SDLT) ended as of 1 April 2025. It means that first-time buyers now have to pay stamp duty when buying homes worth £300,000 (€358,467) and above from now on, down from the previous £425,000 (€507,836.8) threshold. For repeat buyers who own only one residential property, stamp duty is nil up to £125,000 (€149,556.9), with the next £125,000 taxed at 2%. Stamp duty is 5% for the following £675,000 (€807,441.8), while the next £575,000 (€687,809.3) is taxed at 10%. The SDLT rate for any amount above £1.5 million (€1.8m) is 12%. Buyers have to pay an extra 5% SDLT on top of these rates, if they own another residential property. For the first three months to March, the average property price in Northern Ireland was £205,796 (€245,986), while the average price in Scotland was £186,131 (€222,503). In Wales, property prices rose 3.6% in the first quarter of this year, with the average house setting buyers back by about £209,839 (€250,839). In England, the North West saw the second highest house price growth in the UK in the first quarter of 2025, at 5.9%, with the North seeing a rise of 4.7%. Property prices rose 3% in the outer South East, with an increase of 5.8% in the West Midlands and a growth of 2.8% in the South West. The average London property cost £529,369 (€632,691.2) in Q1 2025, with house price growth coming in at 1.9%, compared to 2% in the previous quarter. On a monthly basis, UK house prices flatlined in March, compared to a 0.4% rise in February. Pantheon Macroeconomics said in an email note: 'The 0.0% growth rate for March is the first instance in seven months where the index has failed to rise, though strong gains over the winter in the index still point to healthy increases in the ONS official measure of house prices, which typically lags movements in the private sector indices.' It also noted that no change in the index in March was impressive, given the uncertainty households most likely felt because of the Chancellor's Spring Statement and the looming stamp duty threshold changes. Related Property sector in danger? More countries may follow Spain's tax moves Alice Paine, personal finance analyst at Bestinvest by Evelyn Partners, pointed out that house buyers were likely to be more hesitant to make purchases in the next few months, given the stamp duty increases. 'Homebuyers are likely to weigh up the cost of home ownership very carefully from today. As well as rising transaction costs, they must contend with uncertainty about the wider economy as the country braces for the fallout from the triple hit to businesses this month from rising National Insurance costs, business rates and the minimum wage. 'Many employers plan to pass on higher costs to consumers, and with a raft of household bills going up from today - from energy to water, council tax and more - budgets are going to get stretched to the max,' she said. Paine also highlighted that even though borrowing costs may fall if the Bank of England chooses to keep loosening its monetary policy, the economic outlook for the UK is still uncertain. This is mainly because of escalating tariff threats from US president Donald Trump, as well as the potential impact of Chancellor Rachel Reeves' tax increases. However, there may be a silver lining for first-time buyers, as a number of mortgage providers now seem to be easing their lending terms, with a wider range of no-deposit mortgages now available. Sign in to access your portfolio
Euronews
31-01-2025
- Business
- Euronews
UK house prices rise but growth slows on high borrowing costs
The UK Nationwide House Price Index for January was released on Friday, increasing 4.1% on an annual basis, according to Nationwide Building Society. This was a fall from the two-and-a-half-year high of 4.7% seen in December, while also missing analyst expectations of 4.3%. House prices rose 0.1% on a month-on-month basis in January, down from 0.7% in December, as well as below market estimates of 0.3%. This was mainly because of ongoing high interest rates, as well as high deposit requirements, which have made it much harder for purchasers, especially first-time buyers, to save for a deposit. Soaring rents and an ongoing cost of living crisis have also exacerbated this situation. Robert Gardner, chief economist at Nationwide, said in the house price index report on the company's website: 'The housing market continues to show resilience despite ongoing affordability pressures. "As we highlighted in our recent affordability report, while there has been a modest improvement over the last year, affordability remains stretched by historic standards." He added: 'A prospective buyer earning the average UK income and buying a typical first-time buyer property with a 20% deposit would have a monthly mortgage payment equivalent to 36% of their take-home pay – well above the long-run average of 30%. 'Furthermore, house prices remain high relative to average earnings, with the first-time buyer house price to earnings ratio standing at 5.0 at the end of 2024, still well above the long run average of 3.9.' Gardner highlighted that approximately 40% of first-time buyers needed to turn to family and friends for help in getting a deposit together in 2023-2024. This included loans, gifts and inheritances. However, despite these obstacles, overall home ownership levels have not changed much in the last few years, staying stable at 65% in 2024, according to the latest English Housing Survey by the Ministry of Housing, Communities & Local Government (MHCLG). UK housing market remains resilient Although house prices rose less than expected in January, the housing market has remained resilient lately, despite increasIng worries about the UK's economic outlook, after the Chancellor Rachel Reeves revealed £40 billion (€47.86bn) in tax raises in her first Budget. Alice Haine, personal finance analyst at Bestinvest said in a statement: 'While the start to 2025 is slightly more muted than the previous month, demand remains robust, something likely to continue over the next couple of months as buyers rush through deals ahead of an increase in stamp duty land tax from the start of April. 'The Government's decision not to extend the current relief on stamp duty thresholds beyond the end of March is likely to be a motivating factor for many first-time buyers. "Another motivating factor could come next week if the Bank of England delivers a third rate cut, a move likely to give slightly improving affordability levels another boost.' She continued: 'Add in the prospect of more support from the Government if proposals to loosen lending rules go ahead and the outlook for first-time buyers and those looking to refinance or upsize may certainly be improving.' However, she highlighted that whether this resilience continues after stamp duty thresholds go back to their lower levels, from 1 April 2025, is yet to be seen. This could possibly inflate the price of a house purchase considerably.
