Propertymark has cautiously welcomed the latest news that UK house prices fell by 5.3% in the year to September.
It says that whilst the news will provide many aspiring homeowners with the chance to own either their first home or their next one, the latest data from Nationwide demonstrates that the economic effects of events that have happened over the last three years are beginning to have an impact on the UK housing market as we return to more normalised market conditions.
Nathan Emerson, Propertymark CEO, said: “Mortgage approval rates for house purchases remain 30% lower than they did in 2019, a year before the Covid pandemic, so there is a lot of work that both the Bank of England and the government need to do to generate housing growth.
“Nevertheless, many buyers have some reason to be optimistic today, especially as Propertymark’s latest Housing Insight Report shows that there is a 29% increase in the number of new properties for sale, which means there are also more homes to purchase. Also, the figures have remained the same since August year-on-year, which is positive.”
According to Nationwide, the UK’s largest building society, their house price index suggested seasonally adjusted prices stalled during September, following a 0.8% drop in August.
Following recent interest rate increases from the Bank of England to tackle rising inflation because of the economic effects of the coronavirus and rising energy prices due to Russia’s invasion of Ukraine, the housing market in Britain has slowed in recent months.
The latest meeting at the Bank of England last month left interest rates unchanged, providing hope for many buyers who are hoping to purchase a home that they would not have to face increased borrowing costs.
Nonetheless, the economic effect of the latest rate rises remains unclear, as Nationwide claimed that recent data from the Bank of England, which demonstrated only 45,400 mortgages were approved for house purchase in August, is 30% below the monthly average in 2019 before the start of the Covid pandemic.
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