UK House Prices Fall At Fastest Pace In More Than A Decade
Average house prices decreased by 2.1% in the 12 months to November 2023, down from a drop of 1.3% in the 12 months to October 2023, according to the latest ONS House Price Index. The average house price stood at £285,000 in November 2023, down £6,000 year-on-year. The data reveals that average house prices over the 12 months to November 2023 decreased by an average of 2.9% in England to £302,000, decreased 2.4% in Wales to £213,000, but increased by 2.2% in Scotland to hit an average of £194,000. In addition, average house prices increased by 2.1% to £180,000 in the year to Q3 (July to September) 2023 in Northern Ireland. The North East was the English region that saw the smallest decrease in average house prices during this period, down 0.4%, while London saw the largest fall, down 6%. Iain McKenzie, CEO of The Guild of Property Professionals, commented: “A fall of around 2% in the space of 12 months is modest considering the scale of the challenges that have faced the economy. Today’s figures show that UK house prices have decreased by £6,000 which – although will be unwelcome news to sellers – could have been much worse. The property industry has always been marked by adaptability, and estate agents across the country have been able to work with sellers to keep healthy levels of properties on the market. Dreams of homeownership have also endured, driven in part by the demand from renters to move away from the expensive rental market. High interest rates remain an obstacle for many, with repayments on some deals outstripping affordability. Lenders are becoming more competitive with their offers, but it may mean shopping around a bit more and looking beyond the rates offered by your bank. Nicky Stevenson, managing director at Fine & Country, said: “Realistic pricing from sellers who were more willing to negotiate with buyers softened house prices in November, but the time lag in the ONS’ reporting means that it feels like much has already changed. “Many forecasters have made positive predictions for house prices in 2024, underlining the property market’s resilience, and there are many reasons for cautious optimism. Stable, or better yet falling, interest rates will help draw greater numbers of buyers to the property market — and lenders have started the year by offering increasingly competitive mortgage rates, widening affordability and increasing demand. The property market is getting busier, with more sellers marketing their homes to capitalise on growing consumer confidence and activity. They are selling to a very motivated pool of buyers who are still quick to snap up good-quality properties in desirable areas. Despite this, there could still be some bumps along the way as today’s small rise in inflation reminds us that the economy is not out of the woods yet. The next couple of Bank of England decisions will play a big role in determining whether increased activity levels can be sustained in the early part of this year.” Lifestyle will be the dominant call for the majority of buyers, driven by distance to work, expanding and retracting families, and home needs. This committed pool of buyers will be targeting only the best-in-class homes as sale listings increase, making price a significant determining factor for a successful sale. The frenzied market that emerged post-pandemic is not the case anymore. Even as buyers adjust to higher mortgage rates the need to get better value from the property itself is likely to play a part in final agreed prices. The 2024 property market is also likely to be impacted by an election. Always a divisive issue, housing is likely to be pushed up the political agenda with major parties both challenging for the hearts and votes of current and prospective homeowners. Supply shortages, market liquidity, and the increasing age of first-time buyers, are all likely to be key discussion points for parties to define positions on. In the coming months, the property market will be gathering around its crystal ball to predict what all political outcomes could mean for local and national property markets.
Tags : Northern Ireland Nicky Stevenson Bank of England property market