What’s
Happening In The UK Property Market – October 2022
Mortgage rates, house prices and
average rents have hit new highs, while stamp duty has been cut in the
government’s mini-budget (one of the few changes to remain after Kwasi
Karteng’s sacking and the appointment of Jeremy Hunt as the new chancellor), and
a property with a place in TV history is on the market! Read on for all this
and more in your October property market update.
Mortgage rates hit new 14-year
highs
New figures have revealed that
fixed-rate mortgages are at their highest levels for 14 years, with hundreds of
thousands of homeowners facing a steep increase in monthly repayments when
their current fixed rates finish in the coming months.
Average fixed rates for two and
five-year mortgages are currently at 6.65% and 6.51% respectively, with interest
rates expected to rise again in November to try and curb inflation, which is
currently at 10.1%.
The sharp increase in rates is
partly due to the government’s mini-budget announcement in September, which
sent the financial markets into a frenzy, but with most of those policies
having since been reversed and with a new government set to be in place by the
end of October, there’s some hope for mortgage holders that rates may drop
again.
House prices hit new high again
Despite rising interest rates, inflation
and cost of living increases, average asking prices have risen to a record high
in the UK.
Figures released by property
website, Rightmove, have revealed that the average asking price in October was
£371,158, a small increase on the previous month.
While the increase might be a
surprise to some given the current economic climate, demand for property
continues to outweigh supply, giving sellers confidence they can achieve their
full asking price.
Asking prices are predicted to
drop slightly in November and December, in line with seasonal demand, however,
predicting prices for the new year and beyond is impossible for forecasters due
to the current political and economic uncertainty in the UK.
Stamp duty cuts are here to
stay…for now!
In welcome news for home-buyers,
and particularly first-time buyers, the government’s recent changes in stamp
duty have been confirmed by the new Chancellor.
As part of the government’s
mini-budget on 23rd September, then-Chancellor Kwasi Kwarteng announced a raft of
tax cuts, many of which have since been reversed by his replacement, Jeremy
Hunt.
However, the change in stamp duty
was one of the only cuts to be kept in place. The change means that stamp duty
tax isn’t payable on properties over £250,000 – an increase on the previous
threshold of £125,000. For first-time buyers, the threshold for paying stamp
duty is £425,000.
The changes mean that movers will
save up to £2,500, while for first-time buyers the savings can be as much as
£11,250.
Since the new Chancellor’s
announcement that stamp duty changes would be kept, Prime Minister Liz Truss
has resigned, so there may be another shift in policy when a new government is
announced in the coming weeks.
https://www.lysshomes.co.uk/news/whats-happening-uk-property-market-october-2022
26.10.2022