House prices to fall 4% in final quarter of 2023

House prices in England and Wales will fall by 4% in the final quarter of 2023, price comparison website reallymoving has predicted.

This is due to stubbornly high inflation, which stood at 6.7% in September, the cost-of-living crisis and higher mortgage rates putting the brakes on the housing market.

If the prediction is proved correct the average property price will fall from £336,999 in Q3 of this year to £323,594 in Q4.

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.

“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.

“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.”

The biggest quarterly reduction is expected to take place in Wales, at -9.8%, followed by the North East, at -8.2%, and the West Midlands, at -8.0%.

Going against the trend are Scotland and the South West of England, where prices are predicted to increase by 1.0% and 0.6% respectively.

Kindly shared by Property Wire