Average house price inflation was 2.7% in the 12 months to June 2024, marking no change from the revised estimate of 2.7% in the 12 months to May 2024.
According to the latest figures from the Office for National Statistics (ONS), the average house price was £288,000 in June, £8,000 higher than 12 months ago.
Average house prices in the 12 months to June increased in England to £305,000 (2.4%), increased in Wales to £216,000 (1.8%) and increased in Scotland to £192,000 (4.3%).
The average house price increased in the year to Q2 (April to June) 2024 to £185,000 in Northern Ireland (6.4%).
On a non-seasonally adjusted basis, average UK house prices increased by 0.5% between May 2024 and June 2024, little changed from the same period 12 months ago.
In addition, average private rents increased by 8.6% in the 12 months to July 2024 (provisional estimate), unchanged from in the 12 months to June.
Average rents increased to £1,319 (8.6%) in England, £748 (7.9%) in Wales, and £965 (8.2%) in Scotland, in the 12 months to July 2024.
In Northern Ireland, average rents increased by 10.0% in the 12 months to May 2024.
In England, rents inflation was highest in London (9.7%) and lowest in the North East (6.1%), in the 12 months to July 2024.
Reaction:
Jeremy Leaf, North London estate agent and a former RICS residential chairman:
“Here’s another example of the housing market’s resilience – very little change in prices at a time of considerable election and interest rate uncertainty.
“Activity has improved since, helped by the long-awaited cut in base rate although already taken into account by many.
“The slight uplift in the latest inflation figures is unlikely to knock the interest rate reduction strategy off course but will have some impact on confidence as it is likely that the pace may slow a little, leaving the market to find a new level.”
Tomer Aboody, director of specialist lender MT Finance:
“There is plenty of evidence of confidence returning to the market, as mortgage providers follow the Bank of England rate cut and offer more flexible mortgages.
“An uptick in activity is also clear, although it is still significantly down on previous years so a push will be needed.
“We wait to see whether the Government will assist first-time buyers in the autumn Budget.
“But encouragement in some form, both from the Government and mortgage providers, is needed to fuel transactions and activity.”
David Castling, head of intermediary distribution at Atom bank:
“The property market appears to be in a good place. The ONS has reported that prices are continuing to rise, with improving activity levels clearly a factor.
“Rightmove’s latest research found that the number of agreed sales are up by around 15% on a year ago, for example, while the Bank of England’s decision to cut the Base Rate should only add to that sense of momentum, with more hopeful homeowners pursuing purchases as lenders begin to drop mortgage rates.
“While rising house prices are a sign of economic improvement, they present real challenges to would-be homebuyers, particularly first-time buyers.
“Saving a deposit has only become more difficult as house prices and outgoings have grown, while loan-to-income caps may mean borrowers miss out on a property even if they are well placed to meet the repayments.
“It’s vital for lenders to deliver funding that addresses the actual needs of these borrowers through high loan-to-value (LTV) products and more generous loan-to-income (LTI) caps so that all potential first-time buyers have a chance of getting onto the housing ladder, even if they cannot call on financial help from loved ones.”
Ed Phillips, Lomond CEO:
“The property market has continued to prosper as buyer confidence has grown following a hold on interest rates and this has caused house prices to not only stabilise, but we’re now seeing consistent upward growth.
“It’s important to mention that, given the lagged nature of house price reporting, this positive growth doesn’t yet account for the boost in market sentiment that is bound to follow the cut to interest rates at the start of this month.”
Marc von Grundherr, director of Benham and Reeves:
“Five consecutive months of positive monthly house price growth demonstrates that the UK property market is very much bouncing back from the period of stagnation caused by higher mortgage rates.
“Buyers are acting with greater confidence and this confidence will only grow all the stronger now that interest rates are starting to fall and so we expect to see a very strong end to the year, both in terms of buyer activity levels and the resulting boost to property values.”
Verona Frankish, CEO of Yopa:
“Not only are house prices climbing on a monthly basis but we’ve now seen four straight months of positive annual growth and this is an even stronger indicator that the market is on the up.
“Whilst a cut to interest rates is great news for the nation’s homebuyers, it’s those looking to sell who are best advised to act now if they want to capitalise on the increasing level of buyer demand that is set to sweep the market over the coming months.”
Malcolm Webb, technical director, Legal & General Surveying Services:
“It’s not just the weather that’s been heating up this week, with a cut to the base rate and return of sub-4% mortgage products proving to be the confidence boost that many needed to reinvigorate their searches.
“Although experts are generally predicting minimal changes to house prices for the rest of the year, lower mortgage rates do raise the possibility of more movement in 2025.
“If you’re weighing up a move, do consider consulting a qualified mortgage adviser as a first step.
“Advisers can help streamline the process by finding suitable products, translating the jargon, providing tailored advice, and potentially offering access to a wider range of products – and when you do find the property that’s right for you, it’s always worth getting a proper survey”
Nick Leeming, chairman of Jackson-Stops:
“Olympic fever spread to the housing market last month with today’s figures showing a further boost to house prices in July.
“With much of July underpinned by Labour’s landslide election victory, the market is riding on the coattails of a new political dawn.
“Nearly six weeks on from the election, with inflation holding steady and the base rate having been cut for the first time since 2020 – the hope is that this will lead to a softening in mortgage prices and will provide a rosier picture for the market’s trajectory.
“There is a new sense of confidence in the market and as a result buyer demand is slowly ticking up – last month we saw viewings increase by 15% across the Jackson-Stops network.
“The limited number of properties available compared to the level of demand will likely start to drive fierce competition from committed buyers, especially in popular commuter belt spots such as Dorking, Oxted and Woking. Currently, we have nine buyers chasing every listing on the market.
“The property market’s resilience can be pinpointed to the cyclical changes in people’s lifestyle and life stages requiring them to move, but what can hold activity back is affordability at the lower end of the market – this can cause chains to stall or stop altogether.
“Labour has committed to boosting housebuilding which would help to rebalance supply and demand and address the affordability gap for first time buyers.
“But, until spades start to hit the soil, sellers will continue to have the upper hand and house prices will naturally reflect this.”
Tony Hall, head of business development at Saffron for Intermediaries:
“Today’s figures represent the optimism felt across the market as rates come down and buyers who were holding out for the interest rate cut in August begin to make their move.
“Slower inflation and wage rises are also increasing consumer confidence, which will help unlock further demand in the months ahead.
“While it is great that mortgage rates are on a downward trend, borrowers should bear in mind that any further rate reductions are likely to happen gradually, and that one large drop is unlikely in the near future.
“However, this period of stability is a great opportunity to consult a professional financial adviser and take stock of all the options available to find the best product for you.
“At Saffron, we focus on providing solutions to as many borrowers as possible, no matter how complex their individual financial situation.”
Paul Glynn, CEO at Air:
“We are in the centre of a mortgage price war, and the heated competition is stoking the housing market.
“After a long-awaited cut in the base rate by The Bank of England, the stage has been set for a season of stable growth, and we are already seeing the dividends in today’s data.
“Lenders are being swift and reactive in response, with provisions of five-year fixed rates dropping below 4% which will inevitably continue to spur proactivity among first-time buyers and the wider market alike.
“This data marks four consecutive increases of house price growth, leaving no doubt that the turbulence of 2023 is finally in the rear-view mirror.”
Alex Upton, managing director of specialist mortgages at Hampshire Trust Bank:
“We are seeing great appetite from investors, whether they are looking to hold onto the property as a buy-to-let or sell it on after carrying out refurbishment work.
“While the market has become more challenging for amateur investors, seasoned professionals are well-positioned to capitalise on these opportunities.
“It’s crucial for these investors to have certainty over their funding.
“This goes beyond just speed; it’s about ensuring that lenders deliver on their promises without shifting the goalposts.
“The best lenders distinguish themselves not just by their rates or speed, but their consistency and reliability.”
Aman Bajwa, co-founder and director of Fairbridge Capital:
“Today’s figures are proof that a tough year for UK property investors is giving way to a period of opportunity, with falling interest rates and lower inflation driving demand.
“The Government’s decision to prioritise the property market in the long-term, after a number of years characterised by short-term decision making, is also increasing investor confidence.
“This means we can expect higher levels of activity in the coming months, particularly in the specialist lending sector, which is primed to support borrowers who may not be served as well by mainstream lenders.”
Holly Tomlinson, financial planner at Quilter:
“Today’s Government House Price Index presents a picture of a UK property market that is gradually picking up steam, despite facing challenging economic conditions.
“This steady, though modest, growth suggests that while the market is on an upward trajectory, it is doing so cautiously, reflecting the broader economic uncertainties at play highlighted by the slight rise in inflation just this morning.
“The Halifax House Price Index released last week for July underscored this momentum, pointing out that the market, after three relatively flat months, is beginning to heat up—particularly during what is traditionally a busy summer period for property transactions.
“The recent decision by the Bank of England to cut its base rate from 5.25% to 5% is expected to further stimulate the market, although the immediate financial impact on homeowners, especially those with fixed-rate mortgages, may be limited.
“However, the psychological effect of this rate cut cannot be understated. It boosts buyer and seller confidence, potentially encouraging more people to enter the market.
“This renewed confidence could lead to a busier-than-expected autumn, as more buyers feel ready to commit and sellers decide that now is the right time to list their properties.
“However, this optimism is tempered by the ongoing challenges faced by prospective buyers, particularly first-time buyers.
“While existing homeowners may welcome the rise in house prices, it continues to make homeownership increasingly difficult for those trying to get onto the property ladder.
“The disconnect between wage growth and house price inflation remains a significant barrier, with many relying on family support or delaying their purchase until much later in life.
“This issue highlights a broader challenge for the Government, as addressing the supply and demand dynamics in the housing market is only part of the solution; the deeper issue lies in ensuring that wage growth keeps pace with rising property values, which is no mean feat.
“As we move into the latter half of the year, the market’s response to these conditions—particularly in light of recent interest rate cuts—will be crucial in determining whether this upward trend continues or if new challenges emerge.
“Overall, the housing market appears poised for a potential uptick, but the situation remains fluid, with prospective buyers and sellers needing to carefully consider their options in a market that is both promising and unpredictable.”
