The average UK house price decreased by 2.1% in the 12 months to November 2023, the largest annual fall since 2011, with the average house price now £285,000 – £6,000 lower than 12 months ago.
This is according to the latest figures from the Office for National Statistics which on a country by country measure shows that average house prices in the 12 months to November 2023 decreased in England to £302,000 (negative 2.9%), decreased in Wales to £213,000 (negative 2.4%) and increased in Scotland to £194,000 (2.2%).
The average house price increased in the year to Q3 (Jul to Sep) 2023 to £180,000 in Northern Ireland (2.1%).
Commenting on the ONS figures MT Finance managing director Gareth Lewis said: “While there is a suppression in transactional volumes, there are going to be decreases in values as when a property goes on the market there isn’t an influx of people desperate to buy it. It is more of a buyers’ market because there isn’t a plethora of buyers and that is being reflected in these numbers.
“The market is just bumbling along, with no hugely noticeable decreases in values. The largest falls are in the southeast because in reality those properties are more likely to have been overpriced and probably still are. If people are looking to buy property as an investment, they will go where there is a return on yield and choose areas which fit affordability from a buy-to-let perspective.
“Until we see more people wanting to transact and buy properties, the market is likely to bumble along without too much movement either way.”
Jackson-Stops chairman Nick Leeming says the figures published today suggest a frosty end to the year with buyers putting their searches on hold in order to see how mortgage rates would react as inflation fell once again.
“2023 was defined by mortgage affordability pressures and a shift from immense competition, towards a smaller, more committed buyer pool. “While higher mortgage rates will continue to weigh on the majority of buyers minds, falling inflation will sow the seeds for a busier start to the market in 2024”.
He added: “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.”
Open Property Group chief executive Jason Harris-Cohen commented: “The market has stood fairly firm over the last year despite wider economic turbulence, but we’re yet to see any improvement in property values and it may be some time before we do”.
He added: “Higher interest rates are still dampening buyer sentiment and not only is it taking far longer for sellers to secure a buyer in a proceedable position, but the path to completion is also taking considerably longer.
“So, while home sellers entering the market may still secure a good price, those looking to sell their home quickly are likely to be disappointed.”