Looking to the future, the Halifax House Price Index believes that these price rises are likely to continue through the rest of 2024 and into 2025. Beyond 2025, many market forecasters, such as Savills, have predicted that more significant capital growth will be observed from 2026 onwards. Their Mainstream Capital Value Forecast states projected figures of 4.5% average growth for 2026 and 5% for 2027.
Regarding the latest House Price Index, Amanda Bryden, Head of Mortgages at Halifax, commented: “This continued stability in house prices – rising by just +0.4% so far this year – reflects a market that remains subdued, though overall activity has been recovering. For now, it’s the shortage of available properties, rather than demand from buyers, that continues to underpin higher prices.
“Mortgage affordability is still the biggest challenge facing both homebuyers and those coming to the end of fixed-term deals. This issue is likely to be eased gradually through a combination of lower interest rates, rising incomes, and more restrained growth in house prices. While in the short-term, the housing market is delicately balanced and sensitive to the pace of change to Base Rate, based on our current expectations, property prices are likely to rise modestly through the rest of this year and into 2025.”
