UK House Price Index: House prices continue upward trend but election uncertainty remains

According to today’s UK House Price Index from HM Land Registry, UK average house prices rose 1.1% in the year to April 2024, continuing the previous upward trend in March 2024, which saw a 1.8% increase. The average price of property in the UK in April was valued at £281,000. UK house prices have also risen 0.3% since March.

The latest regional data also shows there was a significant variation in price rises across the UK, with the North West leading the way with the highest annual growth of 3.8%, However, London house prices fell in the year to April by 3.9%.

Stacy Eden, partner at leading audit, tax and consulting firm RSM UK, comments: 'The latest house prices in April show that the market is making headway, due to falling interest rates and inflation. This gentle upward trend in house prices is likely to continue, given the shortage of residential properties available. RICS has however reported a stabilisation of buyer demand following three consecutive months of recovery but more concerningly, there has been a loss of impetus in London and the South East. Their house price trends do suggest stability at the aggregate level, while transactions figures in April 2024 were 10% above last year and 5% above March 2024. But, transactions are still historically at a low level, highlighting the fragility of the market’s recovery.'

'However, the North West’s annual growth is leading the way regionally, and with house prices recovering from a peak-to-trough fall of at least 5% despite high levels of inflation, there is reason for cautious optimism. But, following a positive start to the year with mortgage rates lowering, the housing market’s recovery has been held back by rising mortgage rates in recent weeks. First-time buyers are really feeling the brunt of this, alongside existing supply and demand issues, therefore it’s no surprise that political parties have been focusing on home ownership and housing delivery in their respective campaigns for next month’s general election.'

He added: 'With housing shortages trapping many households in the rental market, the next government should prioritise planning reform, investment in housebuilding and labour upskilling, as well as revisiting SDLT policy, encouraging funds to the market and key to delivering on housing targets. Both main parties are focusing on increasing housebuilding and planning reform, setting out their intentions to build 1.5m and 1.6m new homes respectively. However, given local opposition often arises for significant housing developments, putting this in practice may be too difficult an ambition to realise.'