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UK House Prices Increase by 0.7% in February

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    Houses Prices Increase on a Monthly & Annual Basis

    If you follow UK property news closely, you’ll know that 2024 has gotten off to a much stronger start than 2023. With affordability returning to the market, buyer and seller activity has improved. The uplift in activity is now reflected in house prices.

    According to the latest Nationwide House Price Index, prices have increased month-by-month and annually, further solidifying the upturn in the fortunes of the UK property market.

    Let’s look at the figures in more detail.

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      What Did the Latest Nationwide House Price Index Say About Property Prices?

      According to Nationwide data, UK house prices experienced a 0.7% month-on-month increase in February. This marks the first return to positive territory for the annual rate of change since January 2023. On a yearly basis, there is a 1.2% rise in prices, bringing the average cost of a typical UK home to £260,420 (not seasonally adjusted).

      Speaking about these figures, Nationwide’s Chief Economist, Robert Gardner, points to decreasing borrowing costs and improving property prices. He said:

      “The decline in borrowing costs around the turn of the year appears to have prompted an uptick in the housing market. Indeed, industry data sources point to a noticeable increase in mortgage applications at the start of the year, while surveyors also reported a rise in new buyer enquiries.

      Experts are reacting positively to the latest Nationwide House Price Index. For instance, Tom Bill from Knight Frank spoke about buyers expressing confidence in anticipating a declining base rate, which has increased demand and house prices in recent months.

      He suggests that banks are eager to lend, and mortgage rates are expected to decrease later this year as inflation stabilises. This, in turn, is believed to sustain positive annual growth in 2024, resulting in a projected 3% increase in UK house prices.

      It is interesting to note that Knight Frank had initially projected a marginal decline in property prices throughout 2024. However, they changed their forecast following an increase in activity in the market, as well as optimistic signs that inflation and the base rate would fall throughout the year.

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      What Other Positive Signs Have We Seen in the UK Property Market?

      Property prices are also increasing in the latest Nationwide House Price Index, and several promising signs of recovery have occurred.

      For one, Hamptons noted a considerable surge in buyers enquiring about properties in January, the highest figures seen in a decade, including 2021 and 2022, when the market saw a massive boom period.

      In addition, the most recent Zoopla House Price Index points to the number of for-sale properties rising by one-fifth, while buyer demand has also increased considerably. The index also found that the sales agreed are higher than at the same time last year. As such, investors now have more options if they are looking for buy-to-let homes.

      Discover More: If you want to know more about the UK property market, consider some of our buy-to-let area guides, where we look at property prices and rental yields on a local level. Some of our most popular guides include:

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      Dale Barham

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      Dale is a property content writer at RWinvest. Keeping a close eye on the UK property market, Dale helps our readers stay informed and up to date on the latest market news and statistics.