UK house prices fall the most on record since the financial crisis.
British house prices tumble in December It was the highest quarterly decline since the financial crisis more than 10 years ago, data from mortgage lender Halifax showed Friday.
Median home prices fell 1.5% month-over-month in December. After falling 2.4% in November. And it was the fourth consecutive month of decline. Halifax says
In quarterly terms, home prices fell 2.5%, the largest drop since the three months to February 2009.
Other housing market gauges also show a sharp slowdown in the housing market. This reflects rising interest rates and a deteriorating economy. as households suffer from the rising cost of living
Bank of England data on Wednesday showed lenders approved fewer mortgages than expected in November.
The bond market turmoil triggered by former Prime Minister Liz Truss’ short-term tax cut plans led several lenders to withdraw mortgage offers in October.
“Real estate prices are likely to continue to fall in the foreseeable future,” said Martin Beck, an economist at consultancy EY ITEM Club, which expects house prices to drop about 10 percent over the next 12 to 18 months.
Halifax expects home prices to drop 8% in 2023, although it said this only meant a return to levels last seen in April 2021.
Home prices soared shortly after the COVID-19 pandemic occurred as temporary tax incentives encouraged people to buy bigger homes with gardens.
Halifax said its annual house price growth rate had dropped to 2.0% from 4.6% in November. This is the lowest figure since October 2019.
“As we enter 2023, the housing market will continue to be affected by the broader economic environment. And because buyers and sellers are still cautious. We expect both supply and demand to decline overall,” Halifax director Kim Kinnaird said.