The Nationwide Property Index has today released figures that house prices for May 2023 have fallen by 3.4% in a year. This is the fastest rate of house price falls in 14 years.
The last time UK property took such as hammering was in the Credit Crunch Crisis of 2008/09 when banks globally started to collapse with toxic mortgage debt i.e., having lend too much money to borrowers that could ill afford it and could not repay their loans.
The average house price in the UK according to Nationwide is now £260,732. These figures are different to Halifax’s Property Index as each firm has a different client base and therefore a different average property that they have on mortgage.
This was to be expected after the hug boom in property prices after the pandemic, then high inflation and now increased interest rates to try and bring inflation down but also making mortgages much more expensive than they have been for the last few years.
Do not panic, the property market moves in cycles, we have had the boom now we have the recession but as wages are increased and interest rates are gradually reduced when inflation is under control, property prices will climb again as they always have done. Remember, we are an island and in the words of Mark Twain: “buy land, they are not making anymore”.