Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the implications for his policies of changes in the level of house prices since September 2023.

The most reliable measure of average house prices in the UK is published by the ONS. The latest release is for September 2023, when the average house price in the UK was assessed to be £291,400. That leaves average UK house prices 25% higher than their average level in 2019, although 0.2% lower than their average level in Sept 2022.

While prices have remained resilient, housing market activity has slowed in recent months, largely as a result of rising mortgage rates, which are in part driven by Bank Rate. Monetary policy is the responsibility of the independent Monetary Policy Committee (MPC) of the Bank of England. The path to lower rates is through low inflation, which is why the government is fully committed to supporting the Bank get inflation back down to the 2% target. The MPC continues to have the Government’s full support as it takes action to return inflation to target through its independent monetary policy decisions.

The Government has taken steps to limit the impact of rising interest rates on mortgage holders, through the Mortgage Charter. This Charter sets out the standards that signatory lenders – who represent over 90% of the UK mortgage market – will adopt when helping their customers.

We have also taken a number of measures aimed at helping people to avoid repossession, including protection in the courts through the Pre-Action Protocol, the Housing Loss Prevention Advice Service (HLPAS), and Support for Mortgage Interest (SMI) loans. Accordingly, arrears and repossessions remain at historic lows, despite the rise in interest costs.

The government continues to monitor developments in the housing market closely and consider the implications for its policies.