What's happened
US existing home sales rose 1.3% in July, reversing a four-month decline, while the UK housing market saw a 19% increase in inquiries after the Bank of England cut interest rates. Both markets are experiencing improved buyer sentiment amid declining mortgage rates.
Why it matters
What the papers say
According to the New York Post, US existing home sales rose unexpectedly in July, reversing a trend of declines, with Lawrence Yun, chief economist at NAR, noting that 'consumers are definitely seeing more choices.' Meanwhile, Sky News reported a 19% jump in inquiries in the UK following the Bank of England's rate cut, with Rightmove's Tim Bannister stating that the cut 'sparked a welcome late summer boost in buyer activity.' The Guardian echoed this sentiment, highlighting that the rate cut has led to a significant uptick in buyer interest, with Rightmove adjusting its price forecasts upward due to positive market trends. These contrasting perspectives illustrate a broader recovery in both housing markets, driven by improved affordability and buyer sentiment.
How we got here
The US housing market has faced challenges with rising mortgage rates and declining sales. In the UK, high interest rates had similarly dampened buyer activity until the recent rate cut by the Bank of England, which has sparked renewed interest.
Common question
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What is Driving the Recovery of the US and UK Housing Markets?
Recent trends indicate a significant recovery in both the US and UK housing markets, driven by various factors including interest rate changes and improved buyer sentiment. This page explores the key elements contributing to this recovery and answers common questions surrounding the current state of the housing market.
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A bank is a financial institution that accepts deposits from the public and creates a demand deposit, while simultaneously making loans. Lending activities can be performed either directly or indirectly through capital markets.
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Rightmove plc is a UK-based company that runs rightmove.co.uk, the UK's largest online real estate portal and property website. It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.