Industry reacts as property values cool in October

CEO of Alliance Fund, Iain Crawford, commented:

“The property market is still standing firm, but we’re now seeing concrete signs that the marathon period of double-digit price hikes spurred by the pandemic are coming to an end.

While this certainly doesn’t signal that a market collapse is on the horizon, the latest mortgage approval data From the Bank of England also shows that buyer appetites eased in September.

However, it remains unclear as to whether we’re witnessing a notable reduction in buyer demand, or the temporary impact of an unsettled mortgage sector following the government’s shambolic mini-budget.

While the latter is more likely, it will be a few months yet before we know if we’re in the midst of a property sector slump, or simply a seasonal market slowdown.”

Director of Benham and Reeves, Marc von Grundherr, commented:

“Any market slowdown is likely to strike fear into the hearts of the nation’s homeowners, but a reduction in the rate of house price growth should be largely welcomed.

The monumental levels of house price appreciation seen throughout the pandemic market boom just simply aren’t sustainable and it’s far better the market steadily returns to normality, rather than crashing back down to earth with a bump.

James Forrester, Managing Director of Barrows and Forrester, commented:

“Despite the panic of recent weeks, we’re simply seeing no let up from buyers on the ground and there remains a far greater appetite for homeownership than the available housing stock to satisfy it.

While this remains the case, any fears of a property market crash can be firmly put to bed and we expect to see house prices continue to increase on an annual basis throughout the remainder of the year, albeit at a more measured pace, as has already been the case in recent months.”

Managing Director of HBB Solutions, Chris Hodgkinson, commented:

“All current signs point to a housing market running dangerously low on steam, with buyer demand starting to fade, while dangerously over-inflated house prices can no longer maintain the trajectory of the last two years.

With many buyers also being hit by increasing mortgage costs, we can expect a turbulent few months ahead, as sellers struggle to achieve their desired asking price, leading to a raft of sales falling through.”

CEO of Octane Capital, Jonathan Samuels, commented:

“We’re now starting to see the level of buyers entering the market return to pre-pandemic levels and this drop in demand will inevitably impact the level of house price growth being seen across the UK market.

At the same time, the average cost of repaying a mortgage is now at its highest in over a decade and this will also impact house prices, with prospective buyers no longer able to stretch to the same house price heights seen over the last two years.

As a result, the housing market will start to cool as we approach the end of the year, but it’s unlikely we will see a property market crash, rather a softening of the curve.”