Property Prices Falling Fastest Since 2009

Nationwide’s Property Index has confirmed that average property prices in the UK are falling at their fastest rate since the Credit Crunch Crisis of 2008/09.

It’s report for July found that property prices fell by 3.8% pa.  From the month of June to July, prices fell by 0.2%.

The average UK house price for Nationwide’s average property is now £260,828 and is now 4.5% below the August 2022 high.

Comment

As we all know, much higher interest rates are causing borrowers problems on afordability resulting in vendors (sellers) accepting lower offers.

On Thursday, interest rates are expected to be increased again by the Bank of England from 5.0% pa to 5.25% pa.  This will of course add further pressure to the property market with some forecasters predicting a property market collapse although we cannot see this as lenders are already pricing in interest rate cuts towards the end of the this year or more likely early in 2024 and starting to reduce mortgage interest rates on 2,3 and 5 year fixed rate deals.

It will be tougher and rates may rise to 5.50% pa or even 5.75% pa before they start to fall. 

All eyes are on the Bank of England this Thursday and the Office for National Statistics for their next inflation report due on 14^th August, just under two weeks away.