House prices are declining and along with the purchasing price of properties, the value of properties owned could fall. For many homeowners, there is little concern about the value of their property as it rises and falls during economic times. However, there is a reason to be concerned. When homeowners come to the end of their mortgage term and seek out a remortgage, the value of their property matters. It can make a difference as to whether they can or cannot remortgage, and it will come into play as to what remortgage offers they will qualify for and that could bring about a lower or higher interest rate for the homeowner.

The government data on the UK housing market revealed a slight increase in the annual average house price in August, but less than the increase of the annual average house price in July. According to the Office for National Statistics (ONS), there was only an increase of 0.2% for the annual average in August which took the house price to £310,000. The monthly increase from July to August was 0.3%.

The release of inflation data has revealed that inflation remained stubbornly steady in September. The information comes weeks before the next meeting of the Bank of England’s Monetary Policy Committee (MPC) is scheduled to discuss if the standard base interest rate should be increased again. There was not a meeting of the MPC in October, and the last meeting which occurred in September left the rate at 5.25% and broke the fourteen meeting trend of hiking the rate which had started on December 2021. Another rate hike might be needed to push inflation down, but whether the economy and consumers 

The Summer of 2023 has joined the same status as the post summer season before the 2008 economic crash. According to the recent report from Rightmove, the 0.5% post summer increase of homes on the market is the smallest in 15 years. The average new asking price in the month to October 7 was £368,231. The annual average asking price to October 7 declined by 0.8%, which is seen as a direct result of the higher interest rates offered by lenders.

According to a new analysis of the recent report on house prices from Nationwide, estate agency Savills has shown house prices were in much greater decline if taking into account inflation. The report reveals housing wealth in many regions of the UK are no better than they were prior to the 2008 financial crisis. The decline of 2.8% in nominal terms since the record high in March 2022 is in contrast with the 13.4% decline when considering real terms.

Homeowners and hopeful home buyers hoping for the high interest rates to take a downward turn as quickly as they rose will be disheartened by the latest report from the International Monetary Fund (IMF). The influential global group reporting on the state of the global economic conditions revealed their forecast for the UK is for higher interest rates to last for five years in the fight against inflation. It should be noted that the report was compiled before the recent revisions to UK growth by the Treasury or the recent declaration of war in Israel.