Cornerstone Tax: UK house prices fall and sales increase
David Hannah, Group Chairman at Cornerstone Tax, discusses the housing market as UK house prices fall and sales increase.
New data published by the Office of National Statistics has found that house prices fell 6.5% in February. The average UK house price was £288,000 in February 2023, down slightly from £290,000 the previous month.
The recent price falls, alongside news of sales numbers reaching pre-pandemic levels, indicate that the market is stabilising with a wave of buyers poised to enter the market again.
In light of the promising news, Group Chairman of Cornerstone Tax, David Hannah, offers his thoughts on the market showing signs of becoming both a buyer and seller-friendly environment.
As mortgage rates increased, the market saw a dramatic reduction in buyer appetite. However, activity is now beginning to pick up again due to sellers having to accept the ‘re-adjustment’ to house prices to make a sale.
This has resulted in the reduction of the demand and supply imbalance as more stock becomes available for buyers.
Estate agents have reported that there were 35 homes for sale per branch in March. This was the highest number of homes for sale per branch since January 2021 – a year ago, there were just 20. In light of this news, new reports show sellers are flooding back to the market in a surge of new confidence.
Hannah believes that the renewed confidence in sellers who are looking to move into their next home, coupled with the fall in mortgage interest rates, has pushed property prices to a more affordable level.
This has encouraged a wave of buyers back to the market resulting in the number of sales being agreed to increase, with the average number of sales back to pre-pandemic levels in 2019.
Despite calls for a market crash from industry experts, Hannah maintains that, with the encouraging figures, the market will grow between 6-8% by the end of 2023.
David Hannah, Group Chairman of Cornerstone Tax, explains:
“The UK is going through a re-adjustment period regarding property prices and is slowly adapting to the new rates of mortgages.
“However, we are already beginning to see a fall in fixed rate mortgages, which has resulted in a wave of buyers returning to the property market.
“There are now real opportunities for those ready to take them.
“We are in a situation where sellers have renewed confidence in the market, which has resulted in more properties becoming available.
“This means prices are falling to an affordable level and buyers now have more choice.
“There will be no crash and no 7-10% fall in property prices that we saw in the noughties.
“Over 2023, I expect to see low to mid to single-digit growth in the UK property market.”
Kindly shared by Cornerstone Tax
Main article photo courtesy of Pixabay
