The UK has seen the biggest fall in annual UK house prices since 2009, according to Nationwide’s latest report.
The average price of homes sold in May was 3.4% lower than a year ago, the biggest drop since July 2009, when the average price fell 6.2% at the end of following the financial crisis.
For the month of May, prices fell 0.1% on a seasonally adjusted basis, partially offsetting the 0.4% increase in April.
The average house price was £260,736 in May.
Nationwide Chief Economist Robert Gardner comments in the latest figures: “After tentative signs of improvement in April, annual house price growth slowed again in May, falling to -3.4. % (against -2.7% in April).
“However, this largely reflects base effects with prices broadly stable over the month after adjusting for seasonal effects. Average prices remain 4% below their August 2022 peak.
“Recent data from the Bank of England has shown signs of picking up activity in the housing market, although the number of mortgages approved for home purchases in March is still around 20% to pre-pandemic levels.”
Jeremy Leaf, a London-based estate agent and former chairman of residential RICS, said that, like HMRC’s disappointing but unsurprising deal figures, this respected house price index is also a bit historic.
“The numbers reflect what happened not only after the mini-budget in September when so much activity came to a halt, but also the improvements since.”
He adds: “The continuing concerns about the cost of living highlighted in recent core inflation figures are undermining confidence and having a ripple effect on the cost and availability of mortgages, inevitably leading to a fall in real estate prices.
Tomer Aboody, Director of MT Finance, responds: “While more positive signs were emerging in the early months of the year, this slowdown signals continued uncertainty in the market as rate hikes continue and perhaps peak much higher than expected. initially.
“As the Bank of England struggles to bring inflation under control, many sellers and buyers are waiting to see what the next few months have in store. If we then see a halt in back-to-back rate hikes, that will give them more confidence to continue.
He concludes: “Government intervention in the housing market will be expected in the coming months to push the economy in a more positive direction, as the general election will come very quickly.”