Property News: Home prices dropped in October
Find out the most recent developments in UK property news, from rising interest rates to the government's commitment to 300k homes per year.
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The Latest Property News
Here we look at all of the the latest in UK residential property news this week.
According to Nationwide, UK home prices dropped significantly in October
The month-on-month decline - the first since July of last year - was almost 1%.
Nationwide has said that the UK's annual house price rise slowed to 7.2% in October 2022 from 9.5% in September of this year.
Chief economist of Nationwide, Robert Gardner, attributed the decline to be the hostility in the economy following the September mini-budget and a sudden increase in interest rates. Mortgage rates have just reached their highest levels in around 14 years. On September 22, the Bank of England voted to hike interest rates to 2.25%.
Michael Gove confirms that the '300k homes per year 'government target is still in place
Next up in property news this week, after some scepticism over the objective due to his predecessor's pledge to do away with "top down" housing numbers, Michael Gove has recommitted the government to its manifesto commitment to build 300,000 houses annually.
The question of whether the government was still aiming to build 300,000 dwellings annually in England, which was made in the Conservative platform that won the 2019 election, was addressed affirmatively by the new housing secretary this week.
In addition, Gove, who was reinstated as housing secretary last week after Rishi Sunak was named prime minister, hinted that he intended to review and change the process for establishing local housing objectives.
The Bank of England is expected to announce the largest interest rate increase in 33 years
Today, another increase in UK interest rates is unavoidable. Only time will tell how far policymakers push interest rates, as pressure mounts on the Bank of England to do so in order to help tame the highest inflation rate in decades.
As mortgages are decided against this interest rate, homeowners will be paying close attention to any increase.
The short-term effects of this interest rate increase will be most severe for those with Standard Variable Rates or tracker mortgages.
The Bank of England is anticipated to raise interest rates by an additional 75 basis points, according to Money.co.uk mortgage expert Kellie Steed. Interest rates would rise to 3%, which would be the highest increase since 1989. Although the anticipated increase in interest rates has been intended to curb inflation, it's likely that the rates will once again have an influence on mortgage expenses.
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