UK house prices fall in sharpest drop since 2008 crash
House price growth has continued to cool in the UK, with last month representing the sharpest decline in value since 2008.
The average cost of a home now stands at £285,579, after falling by 2.3 per cent in November, according to Halifax today – which began tracking house prices in 1983.
Growth rates have slowed considerably in the past few months, in response to higher mortgage rates and the cost of living crunch in the country.
“While a market slowdown was expected given the known economic headwinds… This month’s fall reflects the worst of the market volatility over recent months,” Kim Kinnaird, director of Halifax Mortgages, said today.
“Some potential home moves have been paused as homebuyers feel increased pressure on affordability and industry data continues to suggest that many buyers and sellers are taking stock while the market continues to stabilise.”
Kinniard lent some relief for those looking to sell, as the market has banked some of largest leaps in value ever seen, since the start of the pandemic.
Property prices are up more than £12,000 compared to this time last year and remain £46,403 above pre-pandemic levels.
While prospective buyers may be rubbing their hands together, estate agents in London have noticed the rate of sales and appraisals is slowing.
Zaid Patel, director at London-based estate agents, Highcastle Estates, said: “The mini-Budget came at the worst time. Sales activity tends to drop towards the end of the year anyway, and the mini-Budget meant transactions dropped even more sharply.
“People are now making offers as low as possible to get the best deal. Unfortunately, I can’t see much activity in December.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, added that the latest data from Halifax shows housing market surveys to be catching up with what has been happening on the ground for the past few months.
“Existing sales are holding up, providing no-one in the chain has to remortgage at a much higher rate. As a result, prices are softening but continue to be supported by low stock and strong employment,” he said.
“New business is hard to come by and only slowing returning now lending rates are starting to fall with buyers factoring in where they expect pricing to be next year.”
While sales are still higher than a year ago, Matthew Thompson, head of sales at Chestertons said appraisals have also taken a hit in recent weeks.
“Compared to November 2021, our branches have experienced a 23 per cent uplift in the number of properties being sold, however, there has been a significant downward trend in market appraisals being carried out,” he said.
“This suggests that, although buyer sentiment is fairly strong, some sellers are still holding off due to economic uncertainty.”