Annual house price growth of 5% in the year to September reflects the release of pent up demand and supply and the impact of temporary SDLT change.

It also provides a stark contrast to ‘returns’ available elsewhere. For example, NS&I have cut their popular direct saver rate to 0.15%.

Future growth will be affected by economic confidence and ‘fundamentals’.

The good news for property investors is that the fundamental drivers of housing demand are strong in an environment of low interest rates, reduced rates of new buildings coming onto the market and limited existing stock.

However, for home buyers and investors alike, relying on future capital growth can be a mistake. Property has had a good year, but future capital growth should be seen as a bonus, not a guarantee.

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