Market Report November 2024 – Buyers sit tight

Growth in prices and number of transactions slowed last month as buyers and sellers awaited the Budget, and the end-of-year slowdown in the sales market now appears to be in full effect. Rental growth may also be losing momentum.

• The Bank of England cut interest rates from 5% to 4.75% this month, the lowest they have been since June 2023. But forecasters now expect them to fall more slowly than previously predicted, and commercial lenders have been increasing their rates.

• The housing market is moving more quickly than in 2023. HMRC reported 91,820 transactions in September, up 9% compared to September 2023. However, this only represented a 1% increase compared to August, suggesting that buyers were sitting tight before the Budget.

• Nationwide’s statistics show that house price growth slowed in October. Prices were up 2.4% year on year, compared to a 3.2% year-on-year increase in September. The average non-seasonally adjusted house price was £265,738.

• Halifax puts the October figure higher than Nationwide: 3.9% year on year, taking the average house price to £293,999. But like Nationwide, Halifax reports that growth is down from last month. The building society’s September House Price Index measured 4.7% year-on-year growth.

• Rightmove found a much higher October average price of £371,958, but also reported year-on-year growth of just 1.0%. The platform further reports a 29% year-on-year rise in the number of sales agreed, and a 12% increase in the number of listings.

• Rental growth has been a lot stronger than house price growth, according to the Office for National Statistics (ONS). They report that rents increased by 8.7% in the 12 months to October 2024, up from 8.4% in September. The fastest growing region was London, where average rents grew by 10.4%.

• Rightmove’s quarterly Rental Trends Tracker for Q3 (July-September) reports 5.2% year-on-year rental growth outside London, with the average rent reaching £1,344. This is the slowest growth recorded since 2021. In contrast to the ONS statistics, they found that rents in the capital grew by just 2.5% year on year, but hit an average of £2,627.

• According to Rightmove, the slowdown in rental growth is because of a closer balance between rental supply and demand. Rental supply has increased 13% year-on-year. Properties are receiving an average of 15 enquiries, down from 23 a year earlier.