Housepresso 6 March 22

Published 6th of March, 2022



House price inflation accelerates in February

That house prices rose in January, after the bumper year of 2021, was a surprise, but the fact that they have risen again, at a faster rate in February is perplexing. No one seems to have told the housing market that interest rates and the costs of living are also rising.

The annual increase of £29,162 is the largest annual increase reported by the Nationwide since the start of their monthly index in 1991.

We had thought that it was the stamp duty holiday that fuelled the recent house price growth, but the stamp duty holiday exited stage left in October last year. The holiday was certainly a catalyst, but has it created an unstoppable monster?

Mortgage approvals rise in January

Mortgage approvals started the year on a positive note, up 3.9% on December 2021. Mortgage approvals have risen every month since October 2021. Increasingly, it is looking likely that the feared post stamp duty holiday housing market lull will not materialise. It seems that as COVID restrictions are scaled back the housing market is moving forward.

Average mortgage rates flat in January

This is the first time that we can recall that average mortgage rates for new business were unchanged from one month to the next, what makes this all the more remarkable is that it comes at a time when Bank Rate is rising. The Bank of England's Bank Rate is the interest rate on which all the other UK interest and mortgage rates are based on or set with reference to. You may have a fixed-rate mortgage, but that rate was fixed based on the financing costs (underlying interest rates and expected interest rates) at the time the rate was fixed.

Scotlands house price winners and losers

The latest data from the Register of Scotland suggests that the average house price in Scotland is £204,718. House prices in Scotland fell on average by 1.3% or £2,590 in January 2022. however, over the last 12 months, average house prices in Scotland increased by 3.9% or £7,750.

To find out which areas of Scotland are hot and which are not, click on 'Read more' below

Twindig Housing Market Index

This week was a stark reminder that the UK housing market does not operate in isolation from the wider, global economy.

In the week that surprisingly saw house price inflation accelerate, the Twindig Housing Market Index fell by 4.3% to 76.8, its lowest level since 6 November 2020 as the potential housing market implications of the war in Ukraine weighed on property market investor's minds.

Aside from the ramifications of Russia's war on Ukraine, this week was a positive week for the UK housing market, more positive, in our view, than investors gave it credit. Foxtons, the bell-weather of the London housing market was so much on the front foot that its feet outpaced its brace of brightly coloured minis. With lockdown in the rearview mirror, the London housing market is full steam ahead.

Anthony Codling
CEO, Twindig

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