On a non-seasonally adjusted basis, average house prices in the UK saw a 2.0% rise between June and July 2022, up from a decrease of 4.8% during the same period a year earlier.
House price growth was strongest in the South West where prices increased by 20.7% in the year to July 2022. The lowest annual growth was in London, where prices increased by 9.2% in the year to July 2022.
This morning's data revealed that at the country level, the largest annual house price growth in the year to July 2022 was recorded in Wales, where house prices increased by 17.6%. In England, house prices increased by 16.4% during the same period, Scotland saw house prices increase by 9.9%, and Northern Ireland saw house prices increase by 9.6% over the year to Quarter 2 (April to June) 2022.
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: "The surprise slight dip in inflation to 9.9 per cent is encouraging although it remains well above the Bank of England’s 2 per cent target and further interest rate rises are still on the cards.
"With 95.5 per cent of mortgages taken on fixed rates during the second quarter of the year, according to the Financial Conduct Authority, borrowers envisage further rate rises and are taking action to protect themselves.
"Lenders are pulling rates to maintain service levels as much as to reprice upwards, while there is growing concern around affordability and borrowing potential. Advice is more important than ever, particularly if borrowers have more complex mortgage requirements."
Simon McCulloch, Chief Commercial & Growth Officer at Smoove, said: “July’s figures demonstrate the underlying strength of the UK housing market. While the cost of living crisis and associated Bank of England interest rate hikes continues to impact activity, the new administration’s decision to cap energy bills until 2024 will likely boost confidence, particularly around affordability criteria. The dynamics of the UK property market continue to be determined to some extent by a lack of supply, which should prop up prices to a degree even in the event of a prolonged recession.
“However, transactions are still taking too long to complete, and this has a knock-on effect throughout the market. Streamlined processes are needed to encourage buyers to begin their home-moving journey and eliminate the stress and unnecessary complexity often associated with the experience. By embracing new technology and digitisation, all parties – from lenders and buyers to solicitors and estate agents – can benefit from an improved, more efficient home-moving process, which in turn will keep the property market moving, even in difficult times.”
Richard Davies, MD of Chestertons, says: “In July, we saw a clear uplift in the number of viewings and the number of buyers registering with our branches. This increase in market activity suggests that, despite economic challenges and the changes to mortgage rules, buyer appetite remained strong.”
“One driving factor behind house hunters wanting to move sooner rather than later are interest rates. With the Bank of England putting up rates more than once this year, buyers have established a stronger sense of urgency. After many house hunters put their search on hold or changed priorities over the past two years, we have since been registering enquiries from families wanting to finally make their move a reality as well as international students, international buyers and office workers who require a pied-à-terre closer to work again.”
