Nationwide House Price Index says property prices plunged £36,500 in 2023 | Personal Finance | Finance
UK house prices decreased by 1.8 percent compared with a year ago, with East Anglia being the weakest performing region with prices down 5.2 percent over the year.
Northern Ireland and Scotland are the only parts of the UK to see prices rise in 2023.
Commenting on the figures, Robert Gardner, Nationwide’s Chief Economist, said: “UK house prices ended 2023 down 1.8 percent compared with December 2022, leaving them almost 4.5 percent below the all-time high recorded in late summer 2022.
“Prices were flat compared with November, after taking account of seasonal effects.”
The number of transactions across the UK was down around 10 percent compared to before the pandemic, and prices are now 4.5 percent below where they were at the all-time high in the late summer of 2022, Nationwide said.
December’s figures showed that prices saw a monthly change of 0.0 percent compared to the previous month. The average price of a property was £257,443.
The average UK house price was £294,000 in December 2022, according to the Office of National Statistics. This is a £36,500 drop in price compared to this years Nationwide House Price Index figure.
Emma Jones, Managing Director at Frodsham-based Whenthebanksays
“This has been no ordinary December, with demand remaining high right until the last few days before Christmas. For now, buyers are still holding the cards but this may change in the months ahead if mortgage rates continue to tumble.
“Should the Bank of England cut rates then all bets are off. Any support from the Government for first-time buyers will pour more fuel onto the fire of demand. After a subdued 2023, 2024 is shaping up to be a much more dynamic year for the property market.”
When considering what’s next in 2024, Mr Gardener explained that there has been some encouraging signs for potential buyers recently, with mortgage rates edging down.
Investors have become more optimistic that the Bank of England has already raised rates far enough to return inflation to target and will reduce rates in the years ahead.
This shift in view is important, as it has brought down longer-term interest rates, which underpin fixed mortgage rate pricing.
He said: “Nevertheless, a rapid rebound in activity or house prices in 2024 appears unlikely. While cost-of-living pressures are easing, with the rate of inflation now running below the rate of average wage growth, consumer confidence remains weak and surveyors continue to report subdued levels of new buyer enquiries.
“Moreover, while markets are projecting that the next Bank Rate move will be down, there are still upward risks to interest rates. Inflation is declining, but measures of domestic price pressures remain far too high.