Budget weighs on UK house prices - Rightmove

18th Nov 2024 07:19

(Sharecast News) - UK house prices eased in November, industry research showed on Monday, as uncertainty around the Budget weighed on demand.

According to the latest house price index from Rightmove, average new selling asking prices fell by 1.4% month-on-month in November, to £366,592. That was steeper that the 0.8% drop usually seen at this time year of year.

Year-on-year, prices rose 1.2%.

However, Rightmove said that despite the government's Budget at the end of October having a "dampening" effect, overall market activity was stronger than last year.

The number of agreed sales was up 26%, while the number of new sellers coming to market was 6% higher.

There were also early signs of a further uptick in demand following the Bank of England's decision to trim interest rates at the start of November, the second reduction so far this year.

Tim Bannister, Rightmove's director of property science, said: "There's been a lot of news to digest for homeowners over the last few weeks, and it appears that the market may still be chewing it over.

"We had been seeing a drop-off in buyer demand, both in the lead up to the Budget and in its immediate aftermath, as it was confirmed that there will be an increase to stamp duty charges.

"However, a second Bank Rate cut and a boost of optimism regarding 2025 appear to have reversed this trend at least temporarily."

Rightmove currently expects new seller asking prices to rise by 4% in 2025, its highest prediction since 2021, as lower mortgage rates help release pent-up housing demand.

Bannister added: "The big picture of market activity remains positive when compared to the quieter market at this time last year. This sets us up for what we predict will be a stronger 2025 in both prices and number of homes sold, particularly if mortgage rates fall by enough to significantly improved affordability for more of the mass market."