With high summer in full swing, the property market has entered into its usual seasonal phase. Less fevered activity has been replaced by a more measured approach to home moving. This is widely attributed to holidays, the build-up to a General Election and even the European Football Championships.
The mood of the nation was reflected in Rightmove’s latest House Price Index. The portal says the average asking price of a property coming to market remained flat in June, at £375,110. This is a trend consistent with previous years when the summer lull descends.
House prices remain stable
It’s a similar story when it comes to sold house prices. The Nationwide’s June House Price Index found the UK’s average sold price increased by 0.2% in June. This follows a similarly modest rise of 0.4% in May. As a result, it says the UK’s average house price is £266,064.
Lenders start reducing mortgage rates
More movement, however, was registered in the mortgage market. Some of the UK’s leading lenders started reducing their mortgage rates at the end of June. This is thought to be in anticipation of the Bank of England cutting the interest rate in the coming months. A reduction is forecast in either late summer or early autumn.
Other observations made by Rightmove over the last four weeks included the number of sales being agreed. This has stayed steady at 6% higher than a year ago. Buyer demand has also remained stable and is 5% higher year-on-year.
June also brought us news about energy efficiency, with a stark disparity within the UK’s housing sector. Handelsbanken’s latest annual Property Investor Report found 92% of portfolio landlords had received requests from tenants for sustainable features, including heat pumps, solar generators and EV chargers. Additionally, 58% of landlords were asked by tenants for a rental with an EPC rating of C.
The report sat uncomfortably with Rightmove’s latest energy research. The portal found at least 18 million homes – equivalent to more than half of the UK’s housing stock – have EPC ratings of D or below. The importance of ratings is best expressed in pounds.
When analysing the average annual energy bills for a three-bedroom home, Rightmove found the most energy-efficient A-rated homes cost just £508 a year to run. A home with a C rating would incur annual energy bills of £1,669 and this figure jumps to £2,340 if the EPC rating is D. Homes with the lowest EPC rating of G would have average annual energy bills of £5,674.
Rental trends starting to emerge
Returning to lettings and two new sets of statistics shed light on how expensive it is to currently rent in the UK. Indications show much of the heat in the private rental sector has dissipated. Rents are still rising, albeit at a much slower rate. Zoopla’s Rental Market Report, which was released in June, sets the scene.
The portal says rents for new lets have risen by 6.6% in the last year. Although this sounds high, it is radically lower than the 16% annual rise registered in October 2021. Zoopla has the average rent for new lets in the UK at £1,226 per month.
Monthly rent increases are modest
The team at HomeLet monitor rent fluctuations on a monthly basis. It says rents over the four weeks of June rose 0.2%. This was the same increase as recorded for May. As a result, HomeLet has June’s UK average rent at £1,299 per month.
When it looked at annual rental growth in different regions, HomeLet found a runaway winner. Monthly rents in Northern Ireland have increased by 10.8% over the last year. This compares to a rise of 8% in Scotland and 4.9% in Wales.
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