Last year’s mini-budget, introduced by Liz Truss and Kwasi Kwarteng, sent ripples through the property market. It led to a significant surge in mortgage costs, causing an initial hike in house prices to an apex of £291,909 in September, followed by a substantial dip to £282,115 by March. These fluctuations are a testament to the budget’s far-reaching implications on the housing sector, influencing not just property prices but buyer confidence and market health.

Predictions: A Plateau on the Horizon?

Sarah Coles, the head of personal finance at Hargreaves Lansdown, suggests a cautious approach when interpreting these statistics. The apparent stability in annual prices is somewhat reflective of the market’s reaction to last year’s mini-budget rather than an indication of its current strength.

Coles forecasts that the real litmus test lies in the upcoming months. This September’s annual growth figure might appear unstable due to the past year’s financial rollercoaster. However, the succeeding months could reveal a more positive trend as they compare to a time of lower prices.

Deciphering Monthly Market Movements

The monthly data post-March indicates a continued, albeit slowing, rise in house prices. This trend, coupled with fewer mortgages getting approved as revealed by the Bank of England, a decline in buyer demand according to RICS, and fewer transactions recorded by HMRC, suggests a potential deceleration in the market’s momentum.

Coles posits that these signs could herald a period of stagnation, or possibly, a decrease in house prices in the near future. For potential buyers and investors, this could mean a period of opportunity, while current homeowners might need to brace for potential impacts on property values.