Despite the threat of new property taxes in the autumn budget, a sluggish economy and stretched affordability, the housing market continues to prove its resilience, and that’s in what is traditionally a quiet period.

As ever, Rightmove’s index provides the first data, as it’s based on asking prices. It shows prices dropped by 1.3% in August to £368,740, although the property portal describes this as “in line with the ten-year average.” Annual growth, however, is at a more healthy 0.3% and is a far better indicator of the overall health of the market.

Halifax and Nationwide’s indices, which track completed deal prices and run a couple of months behind, are giving off more mixed signals. Halifax’s index recorded a 0.3% monthly rise, marking its third consecutive month of growth with annual increases of 2.2%. Nationwide’s index, on the other hand, had a small 0.1% monthly fall, with annual growth slowing from 2.4% in July to 2.1%.

Robert Gardner, Nationwide’s Chief Economist, blames stretched affordability for the more subdued market, but feels there is still room for optimism, saying:

“The relatively subdued pace of house price growth is perhaps understandable, given that affordability remains stretched relative to long-term norms. House prices are still high compared to household incomes, making raising a deposit challenging for prospective buyers, especially given the intense cost of living pressures in recent years.”

“However, affordability should continue to improve gradually if income growth continues to outpace house price growth as we expect. Borrowing costs are likely to moderate a little further if Bank Rate is lowered again in the coming quarters.”

HOUSE PRICES AND STATISTICS

The indices’ annual figures were all relatively stable in August, with only a small degree of variation between them.

Halifax: Aug: Avg. price £299,331. Monthly change +0.3%. Annual change +2.2%
Nationwide: Aug: Avg. price £271,079. Monthly change -0.1%. Annual change +2.1%
Rightmove: Aug: Avg. price £368,740. Monthly change -1.3%. Annual change +0.3% (asking prices)
Land Registry (England): June: Avg. price £290,956. Monthly change +1.3%. Annual change +3.3%
Zoopla: July: Avg. price £270,000. Annual change +1.3%

BUY-TO-LET

Rental growth remains subdued, with the average rent reaching £1,328 in August, which is just a 0.2% increase when compared to the period last year. This represents a sharp slowdown from the double-digit growth rates seen in recent years.

London rents are now 0.9% lower than they were a year ago, though this masks significant borough-by-borough variations. Westminster recorded growth of 3.2%, whilst Tower Hamlets saw rents fall by 2.9%. Outer London areas such as Bromley (+0.6%) and Redbridge and Waltham Forest (+2.1%) recorded increases.

Supply levels have improved, though, with 17% more homes available than a year ago, according to Zoopla, whilst demand has fallen by 25%. The North East remains the most affordable region at an average of £720 per month.