House price declines are gradually easing as sales volumes increase across the UK. In October 2023, prices dropped by -1.4%, slowing to -0.8% by December.
The East of England(-2.5%) and the South West of England (-2.2%) experienced the most significant declines in 2023. In contrast, house prices in Northern Ireland increased by3.2%. Despite this, higher mortgage rates are expected to persist, influencing house prices throughout 2024.
Data indicates that sellers are consistently reducing asking prices to attract buyer attention. More than 20% of sellers are now agreeing to discounts exceeding 10% of the initial asking price, and this figure rises to 25% in London and the South East of England.
Prices have stalled for various reasons, including:
• tax alterations restricted property acquisition by investors and international buyers
• the Brexit vote impacted job growth • the pandemic closed cities which altered work patterns
• elevated mortgage rates disproportionately affected pricier housing markets.
It is unlikely that mortgage rates will fall significantly in the near future, staying within the4% to 5% range.
Interestingly, Nationwide’s January index found that the average house price had increased by 0.7% during the month, a significant turnaround from the December figures.
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