House prices in England and Wales will fall by 4% over the final quarter of 2023, according to research by Reallymoving.
Analysis of over 221,000 property sale prices agreed between buyers and sellers found that the average property price will fall from £336,999 in Q3 of this year to £323,594 in Q4.
The researchers cited stubbornly high inflation, the cost of living crisis and higher mortgage rates putting the brakes on the housing market.
Reallymoving’s Quarterly House Price Forecast uses average house price data collected from conveyancing quote forms. Because registrations for conveyancing quotes typically occur immediately after a sale/purchase is agreed and approximately 12 weeks before the transaction completes, Reallymoving claims its data represents a “unique forecast” of Land Registry data in three months’ time.
According to Reallymoving, while the impact of inflation pressures has taken some time to filter through, with asking prices remaining stubbornly high this year, it’s now clear that buyers who are proceeding with a home move are agreeing to pay less than they did last quarter – and house prices will end the year back where they started in Q1 2023.
Rob Houghton, founder and CEO of Reallymoving, said: “Buyers who agreed property purchases in the third quarter of the year are spending significantly less than they did in Q2, so sellers have clearly been forced to adjust their expectations in order to secure a sale.
“Bearing in mind the financial pressure buyers are under as they adjust to this period of much higher interest rates, and the impact on consumer confidence, it was only a matter of time until the prices they’re willing to pay started to fall.”
However, Houghton believes that softening prices are good news for first-time buyers, who are looking for a way to get onto the ladder and escape “eye-watering rent” increases.
“As a buyer group, they accounted for 53% of all home moves in Q3 – the highest proportion in over a year,” he said. “Encouraged by the possibility that interest rates may start to decrease before long, I expect we’ll see more first-time buyers preparing to enter the market in the coming months.”
Surprise…not! I also feel that that’s being conservative at 4%. I would say most of the house prices have dropped 8% over the last quarter so this year approx 15%.
Forget house prices. Focus on transaction levels.
Those agents not focussing in transaction numbers will be caught asleep at the wheel. Doing a handful of sales a month but then with naff all stock levels are doomed. They will have a very bleak Jan-Mar if they make it that is!
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I very much agree on the sentiment regarding agents, transaction and stock levels.
In regards to price drops it is a Crystal ball situation now. No one knows but the feel is that confidence and therefore prices are heading down rather than up.
Time will tell!!
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Thoughts on Rightmove anyone?? Not sure whether to leave or not…
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Who wants to leave rightmove… it can’t be just me right???
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