Twindig Housing Market Index (HMI) 30 April 22
The Twindig Housing Market Index fell by 3.2% to 77.6 this week, which came as a surprise as house prices rose and heavyweight housebuilders reported burgeoning order books.
On Friday the Nationwide reported that house prices rose again, albeit at a slower rate in April, and April was the 11th month out of the last 12 where annual house price inflation has been in double digits. However, Nationwide did report that they expect the UK housing market to slow in the coming quarters.
Will the housing market slow?
We don't think so, the housebuilders reported growing order books and house price inflation ahead of build cost inflation and a survey from the Nationwide found that almost 2 in 5 (38%) of people are either considering moving home this year or are in the process of moving home. It seems that rising mortgage rates and living costs do not impact those able to move, although we appreciate that not everyone is lucky enough to be in that category. For many aspiring first time buyers, rising costs, rents and mortgage rates merely push the timing of their home purchase from the long grass to the even longer grass.
Looking forward not back
It seems that those investing in the UK housing market are less sanguine about the prospects than we are, with many believing that rising living costs and mortgage rates will turn the lights out (or at least start the dim them) on what has been a very long housing market party.
However, so far the bears have got it wrong, and the strong performance of the housing market has confounded many, including us, but we are not yet ready to call time on the UK housing market's upward trajectory.