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Budget uncertainty sparks a halt in house price growth, according to Rightmove's assessment

October's average asking prices for properties on Rightmove experienced a minimal rise of 0.3%, significantly lower than the typical 1.3% increase for this month.

Budget uncertainties lead to a halt in house price growth, according to Rightmove's assertions
Budget uncertainties lead to a halt in house price growth, according to Rightmove's assertions

Budget uncertainty sparks a halt in house price growth, according to Rightmove's assessment

In the ever-changing landscape of the UK housing market, recent data reveals a mixed picture as the country gears up for the upcoming Budget on October 30, 20XX. House prices in various regions have seen varying levels of growth, influenced by factors such as tax changes and economic conditions.

The North West of England experienced the fastest annual house price growth, with an increase of 4.6%. This growth propelled average house prices to £218,400, marking a significant jump from the previous year's figures. In contrast, the South West saw the slowest growth, with prices inching up by just 0.8%.

Average house prices in Northern Ireland rose 6.4% over the past year, reaching £185,000. Meanwhile, in Wales, house prices increased by 3.5% to reach £223,000, and in Scotland, prices climbed 5.4% to £200,000.

The average price of a property in the UK now stands at £293,000, an increase of £8,000 compared to a year ago. This brings the annual growth rate to 2.8%. However, the Land Registry index shows that annual house price inflation was highest in the North West, where prices increased by 4.6% in the 12 months to August.

The Budget, scheduled for later this month, is causing uncertainty among potential buyers and sellers. Fears of policy changes and tax rises could potentially impact house price growth. Some estate agents report that buyers are waiting for Budget clarity and anticipate cheaper mortgage rates later this year.

The number of homes available for sale in October was 12% higher than the same time period last year, offering a glimmer of hope for buyers seeking more choices. Tim Bannister, director of property science at Rightmove, stated that buyer choice is at a high level not seen since 2014, and sellers need to price competitively to find a buyer.

Chancellor Rachel Reeves will deliver the Budget, and one of the key topics of discussion is likely to be the housing market. The government is considering ending the current exemption from capital gains tax on gains made from selling primary residences above a certain high-value threshold. This could increase costs for sellers of expensive properties, potentially reducing market activity or leading to higher asking prices.

Chancellor Reeves is also exploring replacing stamp duty with a national property levy, and eventually possibly replacing council tax with a local property tax based on property values rather than outdated valuations. These changes could stabilize local government finances but also change ownership costs over time.

Temporary changes like the stamp duty holiday previously led to a surge in house prices and transactions, as buyers rushed to take advantage. With such incentives fading, house prices have shown signs of slowing or modest growth.

According to lender Halifax, house buyers could save up to £50,000 by purchasing a property in a new town built after the Second World War compared to elsewhere in the UK. The average home in London now costs £531,212, while the average property in a new town is £300,656, and the UK average is £346,995.

As the Budget approaches, the housing market remains a topic of great interest and anticipation. Buyers and sellers alike are keeping a close eye on the announcements and changes that could impact their financial decisions and the overall direction of the UK housing market.

  1. The impending Budget, particularly the potential changes in property taxation, could significantly impact the financial aspects of real-estate investing for various businesses involved in the UK housing market.
  2. The variation in house price growth across regions such as the North West, South West, Northern Ireland, Wales, and Scotland, demonstrates the influence of factors like tax changes and economic conditions on property finance and the overall business climate of the UK real-estate market.

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