Rightmove: UK Property Prices Witness First Annual Increase Since August

According to property website Rightmove, the prices of homes listed for sale in the UK have recorded their first annual rise in six months, signaling a strengthening demand from buyers and indicating a stabilizing housing market. In February, asking prices for homes increased by 0.1% compared to the same period last year, marking the first annual uptick since August 2023. Additionally, prices saw a monthly rise of 0.9% from January, aligning closely with the 10-year average monthly increase of 1.0% for February.

The resurgence in Britain's property sector in recent months can be attributed to falling mortgage interest rates, driven by expectations of potential rate cuts by the Bank of England later this year. Rightmove reported a 16% year-on-year increase in agreed sales during the first six weeks of 2024, with figures 3% higher compared to pre-pandemic levels in 2019. Moreover, both properties entering the market and buyer enquiries surged by 7%.

Despite these positive indicators, Rightmove's director of property science, Tim Bannister, expressed cautious optimism, citing persistently elevated mortgage rates compared to historical norms. While the mortgage market has regained stability, the scope for further rate reductions by lenders appears limited, signaling a likelihood of rates remaining elevated in the near term. This sentiment aligns with Bank of England officials' stance, emphasizing the need for sustained evidence of easing inflation pressures before considering rate cuts, despite the economy entering a recession towards the end of last year.

Source: Reuters