29 December 2023
If you are covering the latest Nationwide house price index, please see the following comment from Karen Noye, mortgage expert at Quilter:
“Figures from Nationwide this morning reveal a sluggish end to what has been a challenging year for the housing market. House prices saw no change in December and fell by 1.8% year-on-year due to the ongoing economic pressures, but this is still considerably less than the drastic fall many would have predicted this time last year.
“Looking ahead to 2024, the wider narrative appears to be that of cautious optimism. We have reached the end of 2023 without the appearance of a housing market crash which many had predicted following the mini-budget. Mortgage rates have risen rapidly throughout the year and cost-of-living pressures forced many people to put their plans to move home or take their first step onto the property ladder on hold, but the lack of housing stock and soaring rent prices has resulted in a remarkably resilient market, though demand has certainly been subdued.
“For some households, however, things will not be quite so rosy and there is still a risk that we could see more people forced to sell their homes if the financial strain proves too much to bear. The Bank of England opted to hold interest rates at its latest monetary policy decision which will heap pressure onto households next year as more fixed rate deals come to an end, and we could see potential buyers hold off in the hopes of securing cheaper deals in the future. House prices have held up relatively well this year, but we are not yet completely out of the woods.
“As we move into 2024, interest rates are likely to remain elevated for some time, particularly if the BoE maintains its ‘higher for longer’ stance. However, inflation is heading in the right direction so we could start to see some movement towards the second half of the year which may tempt prospective home movers and first time buyers and help buoy the market. For those looking to purchase a new home next year, it will be vital to seek professional mortgage advice to ensure you are making the best possible decisions for your circumstances.”
