House Prices Reach New High Amid Policy Changes
- In October 2023, the UK average home price reached £293,999, its highest recorded amount.
- Rachel Reeves' budget proposed measures that could impact future demand for housing, such as higher stamp duty.
- Halifax expects continuing price growth but at a slower pace due to these economic and policy shifts.
In October 2023, the average home price in the UK was recorded at £293,999, marking the highest level ever noted by Halifax. This increase of 0.2% from the previous month indicates a sustained upward trend, with four consecutive months of price growth contributing to an annual increase of 3.9%. Despite concerns regarding the potential impacts of Rachel Reeves' inaugural budget on market demand, homebuyers have been active, leading to the highest number of agreed mortgages in two years. However, the head of mortgages at Halifax cautioned that new policies may dampen demand moving forward. Notably, the new budget includes changes such as increasing stamp duty for second-home buyers and revising first-time buyer thresholds, which could prolong higher mortgage costs due to expectations of slower rate cuts from the Bank of England. Meanwhile, regional price growth remained varied, with Northern Ireland experiencing the most significant rise at 10.2% year-on-year, while London saw a modest increase of 3.5%. Overall, while house prices are anticipated to continue rising, the rate and demand are likely to be affected by policy changes and economic factors.