UK house prices fell at their sharpest annual pace since 2009 after soaring mortgage rates curtailed how much buyers could afford, Halifax, one of the nation’s biggest mortgage lenders said today.
Halifax said the average value of a home fell 1.9% in August alone to £279,569, the sharpest monthly pace since November. It left prices 4.6% lower than a year ago when the value of UK property peaked.
The Bank of England has raised interest rates 14 times since late 2021 tame inflation, and that’s straining the finances of consumers already hit with higher food and energy bills.
As a result, the market is slowing, with year on year property transactions down 21.7%, mortgage approvals also down 21.7% and new buyer enquiries down 45%.
“We do expect further downward pressure on property prices through to the end of this year and into next, in line with previous forecasts,” Kim Kinnaird, director at Halifax Mortgages.
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I caught up with Peter Marshall from Mozo to talk about the current trajectory of interest rates for mortgages, savings and cards, following the RBA’s decision to hold the cash rate at 4.1% on Tuesday.
The point is, more than ever before perhaps, its important to shop around for the best available rates, as banks are seeking to fatten their margins in the current difficult market.
Rate comparison portals such a Mozo https://mozo.com.au/ can help to find the best deals.
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New Zealand’s house price slump has given first-time homebuyers a welcomed leg up in their quest to purchase a property, but it may be a short-lived opportunity.
For a certain segment of the nation’s would-be homeowners — those armed with sizable deposits and solid incomes — 2023 has been a heartening year, with first-time buyers grabbing a record 26% share of the market in the third quarter, according to CoreLogic New Zealand. While an 18% fall in house prices between November 2021 and May this year made homeownership more obtainable, also working in their favor has been strong wage growth, a possible peak in interest rates, an easing of lending rules and government policy changes.
“This is a window of opportunity,” said independent New Zealand economist Tony Alexander. “This is good as it gets.” But Alexander has further words of caution for those looking to get on the housing ladder: The clock is ticking.
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Almost one in three Australians are struggling to make ends meet, as cost-of-living pressures push more people to renegotiate bills, cut back on groceries and access their superannuation early. And one in five hit up friends or family as times tighten.
About 30 per cent of Australian adults find it difficult or very difficult to get by on their current income, according to a quarterly poll by the Australian National University.
Borrowers have been hit with 12 interest rate rises since May 2022 as the RBA tries to get on top of the most acute inflation outbreak in decades.
Financial stress is on the rise, with two-fifths of renters finding it difficult or very difficult to get by on present income amid a nationwide surge in rents.
But the biggest increase in stress over the past year was among people with a mortgage, who have borne the brunt of the fastest interest rate tightening cycle in a generation. About three in 10 borrowers are finding it tough.
None of this should be a surprise to followers of this channel, as I have been reporting the steady rise in cash flow stress in recent times, to new highs. My latest data to end August will be out in the next few days, and the trends continue to deteriorate.
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Today’s post is brought to you by Ribbon Property Consultants.
If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.
Buying property, is both challenging and adversarial. The vendor has a professional on their side.
Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.
Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.
Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.
..Ain’t no fun and games! This is an edited version of our recent live show, which was a dose of reality from Investment Manager Tony Locantro, from Alto Capital. Is the game up, and what are the consequences for investors, home owners and aspiring first time buyers?
More from our property insider Edwin Almeida as we look at the idea of building up, not out, prefabricated housing, poor quality rental property, and the mythology of property listings. And at the end, a real horror show!
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The Australian government this week released the latest iteration of its Intergenerational Report, the sixth since the first was published in 2002. It is an intensely political document of nearly 300 pages.
Powerful forces will continue to shape Australia’s economy over the coming decades including population ageing, expanded use of digital and data technology, climate change and the net zero transformation, rising demand for care and support services, and increased geopolitical risk and fragmentation. These forces will influence the future path and structure of our economy and change how Australians live, work, and engage with the world.
The Australia of the 2060s will be very different from the one we know today. It will be older, with slower economic growth, a big “care” economy, and an export sector that is radically transformed due to the imperatives of climate change. But the finances will be under pressure, and migration will still be a critical element. Housing will continue to be a disaster.
Slower economic growth will place pressure on the tax base at a time of rising costs, creating a long-term fiscal challenge. Despite recent improvements in Australia’s fiscal position, debt-to-GDP remains high by historical standards. Long-term spending pressures are also rising across health, aged care, the National Disability Insurance Scheme (NDIS), defence and interest on government debt.
The economy will be about two and a half times as big, and real incomes are expected to be 50% higher by 2062-63. On the downside, economic growth will be slow – growing at an average pace of 2.2% over the coming four decades, from an average of 3.1% over the previous four decades.
Population will also increase more slowly than previously – by an average of just 1.1% annually. The report projects 40.5 million people in the early 2060s.
Migration is projected to fall as a share of the population. While the number of people 65 and over will double, Australia is still expected to have a younger population than most advanced countries.
Better policy decisions can still reshape the future, but the current mob are on the same ol same ol track, to the benefit of corporations and the well off but not for ordinary Australians who are trapped in this crazy policy vacuum.
Go to the Walk The World Universe at https://walktheworld.com.au/
Today’s post is brought to you by Ribbon Property Consultants.
If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.
Buying property, is both challenging and adversarial. The vendor has a professional on their side.
Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.
Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.
Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.
This is the latest edit of my live stream which is an exploration of the latest in property news. I was joined by Veronica Morgan, co-founder of Home Buyer Academy, co-host of Your First Home Buyer Guide podcast & The Elephant in the Room property podcast, co-founder of Suburb Help, co-host of Foxtel’s Location Location Location Australia & Relocation Relocation Australia, principal of Good Deeds Property Buyers, and author of “Auction Ready: how to buy property at auction even though you’re scared sh!#less”. She is a Licensed Real Estate Agent, Buyers Agent and Qualified Investment Property Advisor.
Listing rise in a number of locations, suggesting potential home price weakness especially in Sydney and Melbourne. So the question is where is the lift coming from, what is driving it, and what are the potential consequences?
Today’s post is brought to you by Ribbon Property Consultants.
If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.
Buying property, is both challenging and adversarial. The vendor has a professional on their side.
Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.
Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.
Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.
