This week was largely dominated by HS2 and the absence of any real housing policy at the Conservative party conference. House prices took a further tumble along with the number of new homes under construction, leaving “advisory” targets abandoned in earmarked sites. Welcome to another UK property news recap.
Average House Price Index showdown
Nationwide pipped Halifax’s to the post…again, with its house price index on Monday. Reporting that both annual and monthly house price growth remained unchanged in August, making the average house price in September 2023 £257,808, down £1,200 on last month and £14,500 year on year.
On Friday, Halifax reiterated that all was not well with house prices, reporting the average house price fell -0.4% from August to September and -4.7% annually to £278,601.
Where they disagree, marginally, on the average house price, there is consensus that all UK regions registered declines with Northern Ireland proving to be the most resilient and the South East and West, the most exposed.
Rightmove Rental Index
Feeling left out, Rightmove released its rental index which was full of further doom and gloom. Supply & demand issues continued to cause havoc for renters as the average asking rent increased 10% annually (+3.8% in Q3) & 12.1% in London. Interestingly, demand for smaller properties outweighs larger homes, no doubt due to affordability issues faced by first time buyers forcing them back to the rental market. (I also wonder if landlords’ preference for families over sharers in their homes may be a reason for less demand issues here.)
New Homes and Construction
New homes news was hardly new. There remains an absence of homes being built due to buyer affordability issues and market uncertainty causing many developers to park sites till economic conditions become more conducive. This was reflected in S&P Global & CIPS purchasing managers’ index, which showed house building contracted 5.2 points from 50.8 in August, the worst rate in nearly 15 years.
This doesn’t bode well for housing “advisory” targets. However, even if the economic environment wasn’t quite as dismal as it currently is, it’s clear developers would struggle to build enough homes due to the 250,000 construction workers who’ve downed their tools since 2019.
PM Rishi Sunak’s migration pass for builders post Brexit clearly not enticing enough builders back, post Brexit.
Conservative Party Housing Policy
And then there was the Conservative party conference. Many would have expected housing might be an issue the PM Rishi Sunak might have wanted to…I don’t know…cover.
Apparently, not.
So I scrapped the blue barrel for something and came up with some 10,000 houses in Euston in exchange for a few HS2 platforms and 20m to be given to 55 towns to be spent over 10 years to revive the high street.
Metro Bank
As soon as news got out that Metro Bank was struggling to balance its books and was scrabbling around for funding, its share price nose dived 30%. To steady the ship it is courting other lenders in the hope they will lend a hand by buying £2.3bn of its £7.5bn mortgage book to raise funds. I expect more from this train wreck over the coming days.
And that concludes another UK property news recap. I’d like to end with something cheery after that smorgasbord of gloom but in the absence of anything news related, I wish you a fabulous weekend.
As always, please feel free to leave comments or further observations here.
