UK house prices drop sharply since June 2020
We found out that UK House prices dropped sharply since June 2020 so If you’re thinking Should I Sell My House Now we came across an article in express.co.uk you may find interesting.
House prices in largest fall since June 2020 – 6 experts explain what this means for you
Annual UK house price growth slowed to just 7.2 percent last month, down from 9.5 percent in September, according to Nationwide Building Society’s latest house price index.
The latest data from Nationwide has revealed that house prices took a tumble in October 2022, falling 0.9 percent month-on-month in the wake of former prime minister Liz Truss’ mini budget. This is the first such fall since July 2021 and the largest since June 2020, the figures show. The average house price has also fallen from a UK average of £272,259 in September 2022 to £268,282 in October 2022.
Nationwide’s Chief Economist Robert Gardner said the property market has been impacted by the mini-Budget which led to a sharp increase in interest rates, meaning housing affordability has been “stretched” at a time when “household finances are already under pressure from high inflation.”
He explained that “the increase in mortgage rates meant that a prospective first-time buyer (FTB) earning the average wage and looking to buy a typical FTB home with a 20 percent deposit would see their monthly mortgage payment rise from c.34 percent of take-home pay to c.45 percent, based on an average mortgage rate of 5.5 percent.”
Mr Gardner warned: “Inflation will remain high for some time yet and Bank Rate is likely to rise further as the Bank of England seeks to ensure demand in the economy slows to relieve domestic price pressures. The outlook is extremely uncertain, and much will depend on how the broader economy performs.”
You can see from the chart below how the average house price has changed over the last two years. But as the latest data reports a decline, what does this mean for you? should you sell your house now? We spoke to the experts to find out.
Monthly UK House Price Statistics
Will there be a housing market crash?
James Forrester, Managing Director of Barrows and Forrester, agreed and said despite there being “panic” in recent weeks, there “remains a far greater appetite for homeownership than the available housing stock to satisfy it.”
“While this remains the case, any fears of a property market crash can be firmly put to bed and we expect to see house prices continue to increase on an annual basis throughout the remainder of the year, albeit at a more measured pace, as has already been the case in recent months.”
Is now a good time to buy a house or not?
Asked if now was a good opportunity for some, Jonathan Rolande, founder of property firm House Buy Fast, said: “Well, the market is still at an almost all-time high so sellers can cash in and sell now – and there are still plenty of buyers about. But only sellers who aren’t re-buying or are moving downmarket will benefit.
“Many buyers have been waiting for a downturn as an opportunity to buy and save money. This isn’t it. With banks tightening lending and rates through the roof, it is more expensive to buy with a mortgage now than it was a year ago, even taking into account the drop in prices.
“The shockwaves of the budget have now passed but we must expect difficult trading conditions as the cost of living rises truly begin to bite this winter.”
Nathan Emerson, Chief Executive of Propertymark, the UK professional body for estate agents, said agents are also reporting more homes for sale which is giving buyers more choice compared to the last two years.
He added: “They no longer have a fear of losing out on a property and can therefore be more level-headed with the offers they’re putting forward, which will naturally see a softening in prices being achieved over the next few months.”
Will the housing market bounce back?
Matt Hoy, Managing Director – Residential at Bradley Hall, said: “Last month marking the first time that house prices have fallen since July last year, when the final lockdown measures were eventually lifted, shows just how much impact the recent economic changes have had on the UK’s housing market.
“Already stretched by rising household bills caused by the sharp rise in inflation, the cost increase of borrowing for a mortgage has further strained the market, with even less people now able to afford a home despite the nation being in the midst of a chronic housing shortage.
“Nevertheless, there are still reasons to be optimistic. The changing of the guard of government with the appointment of a new Prime Minister and Chancellor has led to borrowing costs falling back somewhat in recent weeks and this could continue as the pound bounces back in value and business confidence restores.
“There will undoubtedly be bumps along the road, and the recovery may not immediate, but with unemployment at a 50-year low and plans afoot to push through planning reform and unlocking more housing developments across the country, we will hopefully see the market bounce back sooner rather than later.”
The competition for homes is high – but there is more choice
Despite a sharp slowdown in annual house price growth, property experts and agents are still reporting a surge in enquiries, with Matthew Thompson, Head of Sales at Chestertons, saying their branches registered the same volume as October 2021.
He said: “October’s property market was very much dictated by the avalanche effect of September’s Mini-Budget announcement. Buyers were facing the reality of higher interest rates and mortgage providers withdrawing a number of products, which created a new sense of urgency.
“This has led to house hunters rushing to finalise their purchase, resulting in a 53 percent increase in the number of exchanges compared to October last year.”
However, while the competition to secure your next – or first – home may be fierce, experts say we are seeing more houses come onto the market compared to the last two years.
Nathan Emerson, Chief Executive of Propertymark, said: “[Buyers] no longer have a fear of losing out on a property and can therefore be more level-headed with the offers they’re putting forward, which will naturally see a softening in prices being achieved over the next few months.”
In conclusion, if you’re thinking ‘Should I Sell My House Now’? Then we believe now is a good time. The market is forecast to drop.
If you want to sell your house, visit this link: https://sellmyhousequickly.co.uk/detailed-info