50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

UK house prices became slightly more affordable in 2024, Halifax says

Published 28/11/2024, 07:22
© Reuters. FILE PHOTO: A view of residential homes alongside office blocks in Canary Wharf in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo
LLOY
-
4280
-

By David Milliken

LONDON (Reuters) - Buying a new home in Britain became a little more affordable this year as average wages rose faster than house prices and mortgage costs, the country's largest mortgage lender said on Thursday.

Halifax, part of Lloyds Banking Group (LON:LLOY), said the average house in the third quarter of 2024 cost 6.55 times the mean annual full-time income, down from 6.62 in 2023 and a record high of 7.24 in mid-2022.

The cost of servicing a new mortgage dropped to its lowest in just over two years at 29% of average income, down from 33% a year ago, based on a mortgage with a 30-year term, a five-year fixed interest rate and a 25% deposit.

"While homes are becoming more affordable, the progress has been gradual," Halifax's head of mortgages, Amanda Bryden, said.

"Buying a property remains a significant challenge for many, with prices still near record highs and interest rates likely to stay higher than we've been used to over the past decade," Bryden said.

The Bank of England raised interest rates to a 15-year high of 5.25% in August 2023 and started to cut them in August this year followed by a further reduction to 4.75% this month.

Economists polled by Reuters last week expected the BoE to cut rates to 3.75% by the end of next year, while they predicted house prices would rise by 3.1% next year and 4% in 2026.

Halifax said the average house price in the third quarter of 2024 was 292,508 pounds ($368,823), barely changed on two years ago, although prices vary widely across the United Kingdom (TADAWUL:4280) even after taking regional wage differences into account.

© Reuters. FILE PHOTO: A view of residential homes alongside office blocks in Canary Wharf in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo

Housing was least affordable in southeast England and in London - where new mortgages cost 39% and 36% of local salaries - and cheapest in northeast England at 19% and Scotland and Northern Ireland at 22% of local full-time earnings.

($1 = 0.7931 pounds)

 

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.