Annual house price growth fell to 4.4% in November, down from 7.2% in October according to Nationwide. House prices fell by -1.4% in November, marking the greatest monthly fall since June 2020. The pace of falls accelerated from October when prices fell by -0.9%. Values are likely to continue to fall until pressures on household finances start to ease.

Repricing is clearly underway, with the number of price reductions rising 85% in November, compared to the first nine months of the year according to TwentyCI. Sellers are having to contend with buyers who are being increasingly price sensitive.

Sales completions remained high in October, with 110,850 transactions recorded, 2.7% above the 2017-2019 average for the month. This activity will have been supported by buyers seeking to complete before their mortgage offers at lower rates expired. 

Forward indicators point to a slowing market, however, with new sales agreed falling 12% between October and November, according to TwentyCI. While this is partially due to normal seasonality, this does take sales agreed down to 17% below the 2017-2019 average for the month.

There has also been a fall in the number of new buyer enquiries, with demand falling to its lowest level since 2008 according to the RICS. New instructions also continued to slow.

Another key forward indicator, mortgage approvals, fell by -11% in October according to the Bank of England. While mortgage rates have started to fall, and there has been some recovery in mortgage products available, the mortgage market remains challenging for buyers.

The Autumn Statement had little to say on housing directly, but the freezing of basic and higher income tax thresholds will cut into households’ post-tax incomes, limiting how much they can save for a deposit or for funding their next home move.

The mini-budget’s stamp duty cuts were also announced to be time limited until April 2025. The current lower rates will help to support the market over a challenging period and will likely result in a surge of activity before stamp duty thresholds revert to their higher levels in 2025.

Annual house price growth to August was strongest in South Hams in Devon, up 18.8%. It was followed by Argyll & Bute and then Hastings, up 18.7% and 17.4% respectively. Performance was weakest in Aberdeen City down -1.3%, followed by Hammersmith & Fulham, up 0.8% annually.

Rents rose by 12.1% in the 12 months to October across the UK, according to Zoopla. The level of growth is unchanged from July, as rental growth appears to have plateaued. While lack of supply has supported growth, increasingly tight household finances will also restrain growth.