House price growth continues to slow – Land Registry
Annual house price growth slowed for the fifth consecutive month during March and remains negative on a monthly basis, Land Registry data shows.
The latest Land Registry House Price Index has revealed that annual growth slowed from 5.8% to 4.1% between February and March 2023, putting average prices at £285,009.
On a non-seasonally adjusted basis, average UK house prices decreased by 1.2% on a monthly basis during March, after a 0.1% decline in February.
It is the steepest monthly decline since a drop of 2.1% in October 2021.
Commenting on the data, Karen Noye, mortgage expert at Quilter, said:
“This was not the news many homeowners, particularly those with plans to sell in the short term, will have been wanting to see.
“That said, the average house price in the UK increased by 4.1% in the 12 months to March 2023 so most owners will have seen their asset increase in value regardless.
“The Spring and Summer months typically bring more demand to the housing market and as such prices become more buoyant.
“Homeowners will be hoping that the lower inflation figure may spell the start of the end of the cost-of-living crisis, which will also help keep prices steady at the very least.
“The advent of new products like the 100% mortgage will also play their part in keeping more first-time buyers in the market.
“First-time buyers have been priced out as of recent, suffering with the dual problem of having to raise a large enough deposit and eye-watering interest rates.
“Now, with this new mortgage product, at least one of these problems is dealt with.
“With the economic path now looking a little more predictable house prices may remain stagnant, dropping marginally over the next few months before regaining momentum when the worst of the cost-of-living crisis is behind us.”
Agents remained positive despite the slowing annual prices and monthly declines.
Tom Bill, head of UK residential research at Knight Frank, said:
“UK house price growth continued its return to earth in March following the exceptional growth seen during the pandemic.
“At the same time, the reverberations from the mini-Budget are fading although they have not disappeared completely.
“Transactions are recovering after hitting their low-point in January and it should be a solid but not spectacular year as the impact of a recovering economy, strong jobs market and record levels of housing equity are kept in check by mortgage rates that are notably higher than 18 months ago.
“If stubbornly high inflation keeps interest rates higher for longer, it will increase downwards pressure on prices, which we expect to fall by a few percent this year.
“As the political temperature rises ahead of a likely 2024 General Election, on paper it should be the most uneventful year for the property market since 2018.”
James Forrester, managing director of Barrows and Forrester, added:
“Having paused for breath following a marathon stretch of record house price growth during the pandemic, we’re now seeing a more measured performance from the housing market, but one we expect will be sustained over the course of the year.
“For those buyers currently sitting on the fence, the market is poised to blossom over the Spring months and so they are best advised to act sooner, rather than later, before stock levels are depleted.”
Kindly shared by Estate Agent Today
Main article photo courtesy of Pixabay
