UK average house prices increased by 2.2% over the year to November 2019, up from 1.3% in October 2019.

 

Average UK house prices peaked at £235,000 in November 2019

Average house prices increased over the year in England to £251,000 (1.7%), Wales to £173,000 (7.8%), Scotland to £155,000 (3.5%) and Northern Ireland to £140,000 (4.0%). The annual increase in England was driven by the West Midlands and North West.

 

At a regional level, the West Midlands was the English region with the highest annual house price growth, with prices increasing by 4.0% in the year to November 2019 (Figure 4). This was followed by the North West, increasing by 3.8%.

 

 

Mortgage rates have fallen on average for both two-year and five-year fixed-rate deals (75% LTV)

Fixed-mortgage rates have decreased in the past two years, according to the Bank of England. If you put down a 25% deposit on a property in June 2016, the average rate you would pay for a two-year fixed-rate mortgage was 1.75%. In contrast, in November 2019 it was 1.44%. This suggests that now is a good time to get a mortgage, as interest rates are low. This means your monthly repayments would be lower than they were in 2016.

 

The decrease in rates was even higher for five-year fixed-rate deals. In June 2016 the average rate was 2.54%, while in November 2019 it was 1.69%.

 

For example, for a £200,000 property on a 25-year mortgage, with a 25% deposit an example of the monthly payments would be as follows:

 

2.54% interest: £789 / month

(The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £61,588) Total: £236,588)

 

1.69% interest: £715 / month

(The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £39,608) Total: £214,608)

 

The benefits of a 5-year fixed term may come to light with uncertainty in the economy. However, in the event of the UK having a troubled exit from the EU on the 31st January, such as the scenario of a no-deal Brexit, the Bank of England may cut the interest rate from 0.75% to give a boost to the economy – which could see mortgage rates remain low when you come to re-mortgage. This would suggest a 5 year fixed term would not be only sensible option for somebody buying today. Buyers may benefit from the lower interest rates made available on two-year fixed rates in the years to follow.

 

On our above calculation for November 2019’s two-year interest rate of 1.44%, this would decrease your monthly outgoings to £695 per month.

 

The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £33,501) £208,501