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This is the lowest since June 2020, and is close to the 12-month average up to February 2020, before the onset of coronavirus lockdowns.
Approvals for remortgaging rose slightly to 41,600 in October .
“In the year to the end of September, we saw total spend in the UK housing market exceed £500bn for the first time ever to £513bn.
“Activity in the more expensive price brackets continues to hold up strongly, so we expect to see a higher than normal spend in 2022.
The large drop in transactions is due to the end of the stamp duty holiday which, in England and Northern Ireland, fell at the end of September.
Sarah Coles, personal finance analyst, Hargreaves Lansdown, said: “The monthly drop looks spectacular, as sales almost halved, but this was from an enormous peak, created by the final stamp duty holiday deadline.
Paul Stockwell, chief commercial officer at Gatehouse Bank, added: “Transactions plummeted similarly after June’s stamp duty deadline, so it’s not surprising to see them fall in this way again.
Figures out today from the Office for National Statistics reveal that average UK house prices soared by 11.8% in the year to September, with demand fuelled by the end of the tapered Stamp Duty holiday in England.
The UK average house price for September 2021 was a record high of £270,000, up from £263,000 in August 2021 and £242,000 a year previously.
Miles Robinson at Trussle, our online mortgage partner, commented on the latest figures, published on the same day the ONS revealed that the cost of living rose by 4.2% in October: “The Stamp Duty holiday incentivised buyers to accelerate their moving plans in order to save up to £15,000 in costs.
“But, while the market remained buoyant because of this, the months ahead will likely be more difficult as buyers may start to view the market with caution.
This squeeze in consumer spending will almost certainly impact people’s ability to save for deposits and ultimately move home.
London continues to be the region with the lowest annual house price growth in September at 2.8%, down from 6.7% in August 2021.
Last month also saw a ‘full house’ for first time since March 2007, according to Rightmove’s latest house price index.
Many would-be buy-to-let landlords, especially those entering the market for the first time, will need to take out a special mortgage to fund the purchase.
However, a limited number of lenders offer ‘family’ buy-to-let deals that allow children to occupy the property.
It’s also worth noting that buy-to-let mortgages are arranged on an interest-only basis, meaning the capital debt will need to be cleared in one go at the end of the term.
Miles Robinson at Trussle said: “It’s true that buy-to-lets aren’t the bargain that they once were.
“However, this new data shows that property is still seen as a safe and reliable way of generating extra income.
For those contemplating a buy-to-let property in a university town, Trussle identified the top towns and cities that offer the best rental yields.
For its research, Trussle interviewed 2,000 homeowners with children and examined house prices across 30 popular university towns and cities postcodes in the UK, using Zoopla.
The upward trajectory of house prices continued in October, according to Halifax’s latest house price index.
Annual inflation for October stood at 8.1%, which is the highest rate the mortgage lender has recorded since June.
While the Bank of England opted to keep interest rates on hold yesterday, it’s still expected to increase base rate by the end of this year to tame risks of rising inflation, while further hikes are likely in 2022.
Miles Robinson at our mortgage partner Trussle commented: “Over the past year, house prices have seen record growth, as government support helped keep the market buoyant during lockdown.
“A rise in inflation is on the cards and any increase will almost certainly trigger a corresponding spike in interest rates.
Families are facing a steep rise in energy bills as well as an increase in the general cost of living.
The Bank of England said today that its Bank base rate will remain at 0.1% at least until 16 December, when the next announcement is due.
There has been widespread speculation that the base rate will rise sooner rather than later in a bid to keep a lid on rising prices – inflation is currently running above 3%, with the official target at 2%.
That said, many lenders have priced-in a base rate increase to the deals they are currently offering.
Commenting on today’s announcement, Dan Boardman-Weston at BRI Wealth Management, said: “Many were expecting a hike today in the face of rising inflation, but the decision is quite finely balanced.
However, Mr Gardner added that the outlook for the property market remained “extremely uncertain”.
“In October we witnessed a 22% uplift in the number of offers being made and a 26% increase in agreed sales compared to September.
Mr Gittins said buyer enquiries normally tail off in the latter months of the year, but they are in fact increasing: “At the end of last month, we recorded our highest ever number of new buyer enquiries at this time of year, which was 18% higher than this time last year when.
In September, the government brought to an end the temporary Stamp Duty Land Tax holiday in England and Northern Ireland that had been in place since July 2020.
Lawrence Bowles from the estate agents Savills said: “As if this year hasn’t been enough of a rollercoaster already, transaction figures released this morning show 166,000 homes changed hands in September.
Rightmove also reported record average price rises for the month across all British regions as well as all market sectors, namely, first-time buyers, second-step property purchasers and so-called ‘top-of-the-ladder’ buyers.
Tim Bannister at Rightmove said: “This ‘full house’ is an extremely rare event.
According to Zoopla’s figures, the average British property has risen in value by £49,257 over the past five years.
The bank’s monthly house price index shows the average property was valued at £267,587 in September 2021.
According to the Nationwide’s House Price Index , annual house price growth fell back to 10% this month, down from 11% in August.
“House prices have continued to rise more quickly than earnings in recent quarters, which means affordability is becoming more stretched.
Miles Robinson, head of mortgages at our online broker partner Trussle, said: “The Nationwide index certainly indicates that the market is starting to contract, which is to be expected as the stamp duty holiday finally draws to a close this month.
According to the ONS, workers in tourist hotspots earn less on average than people who live there.
HMRC said August’s figure was also 20% higher than the one recorded for the corresponding month in 2020.
This month, the government will bring to an end the temporary Stamp Duty Land Tax holidays in England and Northern Ireland that have been in place since July 2020.
“The withdrawal of most of the stamp duty breaks at the end of June meant buyers made a dash for the finish line, leaving a gap in July.
“Agents report that buyers who have yet to sell are being out-muscled by buyers who have already sold subject to contract.
Despite the month-on-month decline, the ONS said that average prices in July were up overall by around 8%, or £19,000, compared with a year earlier.
In March this year, the Chancellor announced an extension to the Stamp Duty holiday in England and Northern Ireland.
Forbes Advisor’s UK mortgage broking partner, Trussle, has announced its Mortgage Speed Promise, which will provide customers with mortgage advice within 24 hours and a mortgage decision within five days.
Because of the lack of consistency in mortgage approval times among lenders, Trussle will only work with the UK’s fastest lenders to deliver on its five-day service commitment.
Ian Larkin, Trussle’s CEO, said: Buying a new home should be an exciting time, and so it’s such a shame that it’s considered one of the most stressful processes in life.
Borrowers will not be required to submit further documentation beyond what is currently required for a mortgage application, and a wide range of mortgage products with market-leading rates will be available, including high LTV, buy-to-let and remortgages.
Demand has been fuelled in recent months by changes to stamp duty rules, including the ending of the tax holiday in Wales and the tapering of relief in England.
Price inflation in Greater London continues to lag the rest of the country, according to the Index, registering a 1.3% annual increase in prices in August.
Those with a 40% deposit will be able to take advantage of a two-year fixed rate mortgage at just 0.87% or a two-year tracker at 0.99%.
Elsewhere, the building society is offering a 75% LTV deal at 1.00% with a £1,499 fee and a two-year fix for first-time buyers holding a 5% deposit at 2.99% subject to a £1,499 fee.
Halifax has a two-year fixed rate mortgage at 0.83% with a £1,499 fee or a higher rate of 0.87% if you pay a lower fee of £999.
The relatively high fees of £1,499 attached to some of these sub 1% mortgages might not be cost-effective if you need a relatively small mortgage.
According to the Nationwide House Price Index, annual house price growth rose to 11% in August 2021 with the average home valued at £248,857.
Miles Robinson, head of mortgages at online mortgage broker Trussle, said: “Today’s results will come as a surprise as many expected to see a contraction in the market as the stamp duty holiday draws to an end.
The online broker has seen interest in 95% LTV deals account for a quarter of all its mortgage enquiries in recent months, but says that just 1% of its mortgage completions were from 95% mortgages in July 2021.
Trussle says there are currently 49 lenders offering 95% LTV mortgages, with the number of lenders steadily increasing since March.
While 95% mortgages are struggling to make an impact on the market, Trussle says other high LTV mortgage brackets are seeing significant demand from consumers.
Until 1 July, the first £500,000 of a property purchase was exempt from stamp duty.
Adam Forshaw at conveyancing firm O’Neill Patient said: “It was to be expected that housing transactions would be lower in July, but 62.8% is quite a drop.
Figures from UK Property Transaction Statistics estimated that 198,240 transactions took place on residential properties worth £40,000+ in June 2021.
“While house prices have increased on average, the industry is starting to see a slow-down in the rate at which property value is appreciating.
“It’s important to dig underneath the headline figures.
The lender said this easing was to be expected for two reasons.
According to the Halifax, Wales recorded an annual house price increase of 13.8% to the end of July, its strongest growth figure since 2005.
Russell Galley, the Halifax’s managing director, said: “Recent months have been characterised by historically high volumes of buyer activity, with June the busiest month for mortgage completions since 2008.
The firm said Londoners have led the way in “city out-migration”, one of the key property market trends of the pandemic.
Hamptons said this was the highest half-year figure since its records began in 2006.
Aneisha Beveridge, head of research at Hamptons, said: “Pandemic-fuelled city out-migration shows no sign of slowing.
According to the latest Nationwide House Price Index, annual house price growth slowed to 10.5% in July 2021, having peaked at a 17-year high of 13.4% a month earlier.
Nationwide said stamp duty changes drove the number of housing market transactions to a record high of almost 200,000 in June as homebuyers rushed to meet the deadline.
Since the property market re-opened last year after the first phase of the pandemic, Savills said price growth had been driven in large part by more affluent buyers, less reliant on mortgage debt and able to lock into low, fixed interest rates.
According to Savills, the property markets of both the Midlands and the North of England are anticipated to show the strongest price growth.
“New buyer demand continues to outweigh supply.
Zoopla reported a 25% fall in the number of homes for sale in the first half of this year compared to the same period in 2020, resulting in what it describes as a “severe shortage” of housing stock.
At a regional level, Northern Ireland recorded the highest house price growth at 8.6% over the past year, followed by Wales at 8.4%.
UK monthly property transactions soared to record figures last month as would-be buyers scrambled to complete purchases ahead of changes to the rules on stamp duty.
The figure was 219% higher compared with the same month in 2020 when the effects of the pandemic impacted heavily on the property market.
Until the end of June, the first £500,000 of a property purchase was exempt from stamp duty.
It added that the strongest house price growth over that period had been recorded in the north west of England with a return of 15.2%.
According to the Bank of England, mortgage approvals stood at 87,500 for May 2021.
Figures from UK Property Transaction Statistics estimated that 114,940 transactions on residential properties worth £40,000 had taken place in May 2021.
The average house price slipped to £260,358 last month, according to the latest data from the Halifax House Price Index.
Nicky Stevenson at estate agents Fine & Country said: “The housing market has been running on rocket fuel for some time, but this is evidence that things may finally be starting to plateau.
Associate Editor at Forbes Advisor UK, Andrew Michael is an award-winning financial journalist with a special interest in investment and the stock market.