House Prices Fall at Fastest Rate in 12 Years

The Halifax Property Index for June 2023 was published today.  In its report, Halifax suggests:

• Average UK property now costs £285,932 compared to its peak of £293,992 in August 2022.
• Average yearly house price growth fell to -2.6% in June 2023 down even further from -1.1% in May 2023.
• This is the highest annual property price fall since 2011.

Comment

With Bank of England interest rates at 5.0% pushing average 2 year and 5 year fixed rate deals to over 6% and may even it 6.5% pa or 7.0% pa later this year, it is forcing house prices down as affordabiity is stretched.  We forecast house prices to fall between 10% and 15% in late 2023 or early 2024 from their peak of August 2022. That said, this is merely returning us to pre-pandemic levels and average prices were lower in December 2022, so there has been some recovery this year ahead of these latest falls.