UK house price growth halves as mortgage rates rise sharply

Summarised from 7 outlets · 17 reports · Updated 2 Oct, 11:55 · Archive

Annual UK house price growth halved to 0.8% in September as mortgage rates increased and geopolitical tensions deterred buyers.

Annual UK house price growth halved in September to just 0.8% year on year, according to Nationwide Building Society. The average price of a British home was £274,251, with prices falling 0.2% month on month. This marked the slowest pace of house price growth since December last year, down from the 1.6% annual growth recorded in August.

The slowdown coincides with a sharp rise in mortgage rates. Multiple major lenders increased their rates in recent weeks as they anticipated higher inflation and interest rates. This is Money reports that the average homeowner's mortgage rate has doubled over five years and now sits at 4% for the first time since 2009. Property experts warn that sub-5% mortgage deals are disappearing fast.

Economic uncertainty has dampened buyer demand. The Mirror reports that mortgage costs have jumped by an average of £1,800 a year, with flat owners hit especially hard. Multiple outlets noted that geopolitical tensions, particularly conflict in the Middle East, have exerted upward pressure on energy prices, fanning inflation concerns.

Home sales data reflects the cautious mood. The Evening Standard and Independent Business reported that figures released on Wednesday showed home sales fell in August compared with the previous month and a year earlier. Nationwide said that market activity and house prices have remained subdued, with buyers becoming more cautious amid uncertain economic conditions and expectations of further interest rate rises.

The Reserve Bank has warned that Australia faces similar pressures from rising rates and potential property price falls, though that country's situation differs from the UK.

How it is being reported

• House prices have suffered a sharp slowdown but some areas are much worse than others - full listThe annual rate of house price growth slowed to just 0.8% last month, according to the Nationwide building societyThe Mirror · 1 Oct, 10:30
• House price growth halves in September as mortgage rates riseHouse prices fell in September, according to the latest figures from Nationwide Building Society.This is Money · 1 Oct, 09:31
• UK house price growth halves amid rising mortgage interest ratesPrices fell by 0.2% month on month in September as average price of a home slipped to £274,251, says Nationwide Business live – latest updates Annual house price growth halved in the UK last month, as economic uncertainty sparked by conflict in the Middle East continued to deter homebuyers. The average price of a British home rose 0.8% in the year to September to £274,251, according to Nationwide . That was half the rate recorded in August , when house prices grew 1.6% year on year. It also marked the slowest pace of home price growth since December last year. Continue reading...Guardian Business · 1 Oct, 07:59
• UK house price growth halves as mortgage rates weigh on demandUK house prices rose at their slowest rate since December last month as expensive mortgages and uncertainty ahead of the Autumn Budget fuelled caution among buyers. Prices were 0.8 per cent higher in September than a year earlier, half the 1.6 per cent rise recorded in August, according to Nationwide. Prices also fell 0.2 per [...]City AM · 1 Oct, 07:47
• What happened to UK house prices in September?Changes blamed on geopolitical tensionsIndependent Business · 1 Oct, 07:35
• Annual UK house price growth halves as mortgage rates rise – business liveRolling coverage of the latest economic and financial news Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. Annual house price growth across the UK has halved, according to lender Nationwide this morning, as rising mortgage rates cool the market. “Market activity and house prices have remained subdued in recent months, in part reflecting the uncertain economic backdrop. Geopolitical tensions remain high, with the conflict in the Middle East exerting upward pressure on energy prices, fanning inflation concerns. This in turn has led to…Guardian Business · 1 Oct, 07:15
• Australia at risk from major global financial shock, Reserve Bank warnsWarning comes as central bank estimates fewer than one in 100 borrowers owe more on their home than its worth Follow our Australia news live blog for latest updates Get our breaking news email , free app or daily news podcast The Reserve Bank says households are well placed to weather the twin storm of rising interest rates and plunging property prices, but warned that Australia would not be immune to a sudden collapse of the global AI investment boom. The central bank’s latest financial stability review – a biannual assessment of the financial system – said the “threats to global financial…Guardian World · 1 Oct, 04:32
• Mortgage rates jump for the sixth straight week, hitting both refinance and homebuyer demand hardMortgage demand dropped for the 7th straight week, as rates surged well over 7% on the 30-year fixed.CNBC · 30 Sept, 12:00
• Home buyers being more cautious amid mortgage rate hikes, property experts sayFigures released on Wednesday showed home sales fell in August compared with the previous month and a year earlier.Evening Standard · 30 Sept, 10:36
• Home buyers being more cautious amid mortgage rate hikes, property experts sayFigures released on Wednesday showed home sales fell in August compared with the previous month and a year earlier.Evening Standard · 30 Sept, 10:36
• Home buyers being more cautious amid mortgage rate hikes, property experts sayFigures released on Wednesday showed home sales fell in August compared with the previous month and a year earlier.Independent Business · 30 Sept, 10:36
• House price crash warning as Australians face higher rates, falling values and $90,000 borrowing hitA warning has been issued to Australians.Daily Mail · 30 Sept, 04:59
• Mortgage pain could get even worse as inflation surges to 4 per cent and markets brace for another rate hikeLess than 24 hours after the Reserve Bank delivered another rate hike new inflation data..Daily Mail · 30 Sept, 02:42
• I survived 17.5 per cent interest rates in the 1990s - but what Aussie families face today is even harderBaby Boomers love to talk about the pain of 17.5 per cent interest rates, but one property veteran says today's mortgage holders have it much worse.Daily Mail · 30 Sept, 02:32
• Mortgage borrowers 'hit with £1,800 a year payment hike' amid Iran war fall-outFlat owners have been hit especially hard amid caution from property buyers as mortgage costs have jumped by an average of £1,800 a year since the start of the Iran warThe Mirror · 30 Sept, 00:01
• Three major lenders raise mortgage rates as experts warn sub-5% deals are disappearing fastHouseholds are being hit with a fresh wave of mortgage rate hikes this week as lenders anticipate higher inflation and interest rates.This is Money · 29 Sept, 17:38
• Average homeowner's mortgage rate has doubled in five years and sits at 4% for first time since 2009Most major lenders have increased their mortgage rates in recent weeks on the back of inflation concerns due to the war in Iran and fresh increases in energy prices.This is Money · 29 Sept, 11:23

In this story: Nationwide Building Society · This is Money · UK · Middle East

This summary was written by AI from the headlines and standfirsts above, and states as fact only what at least two outlets report. How we use AI · Report a problem · Corrections log