7 October 2024
If you are covering the latest Halifax HPI, please see the following comment from Karen Noye, mortgage expert at Quilter:
"The latest Halifax data shows house prices have risen once again by 0.3%. As rates have fallen from their recent peaks, potential buyers are finding themselves with more financing options helping drive up demand. Currently, some lenders offer deals around the 4% mark, a stark contrast to the 5% or higher rates seen in the immediate aftermath of the 2022 mini-budget and beyond. This reduction in rates has enabled buyers to secure larger mortgages, making previously unaffordable properties more attainable and boosting buyer confidence.
"However, while rates are improving, they remain significantly elevated compared to pre-pandemic levels, making the cost of borrowing still out of reach for many, especially for first-time buyers. With the interest rate road map still, a little unclear many are facing tough decisions about whether to fix their mortgage now or opt for a tracker. Fixed rates, while providing stability, are much higher than they were before 2020, making tracker mortgages more appealing to those willing to tolerate some fluctuation and potentially a higher price now but with the chance of fixing when rates have dropped more. This has created a competitive market for lenders, with many rolling out various deals to attract new customers.
"The broader expectation is that the Bank of England may continue to adjust rates downwards. Even so, with the October Budget looming, any significant fiscal changes could influence mortgage affordability, leaving buyers cautious. But the current landscape for mortgages is helping to drive house prices up but the market remains fragile, and any economic hiccup could stall or reduce prices once again."
