UK Home prices rise as mortgage costs weigh on affordability

Asking prices for British homes rose by 1% in October, marking a smaller increase than the 1.3% average for the month, according to data from property website Rightmove. The survey, which covers the period from September 13 to October 10, indicates that rising mortgage rates are beginning to impact housing affordability across the United Kingdom.

The average two-year fixed mortgage interest rate climbed to 5.55% in October, up from 5.29% the previous month and significantly higher than the 4.25% recorded in February before the Iran war began. Colleen Babcock, a property expert at Rightmove, noted that these higher costs are pressuring buyers even in markets with lower property prices, limiting the types of homes they can afford.

While asking prices were 0.1% lower than a year earlier, the number of homes available for sale remained at its highest level for this time of year since 2014. Sellers in more affordable regions are setting lower prices to offset affordability challenges, and some buyers are waiting for details on the First Home Scheme and the upcoming finance budget.

Read the full story at wincountry.com.