Case-Shiller Index: Home Prices Fall After 9 Months Of Rising

Table Of Content

• Falling home prices? This interactive map shows the statistical odds of it occurring in your local housing market
• November: HMRC sees October property transactions October halve on September
• Will the Housing Market Finally Recover in 2024?
• UPDATE 7 July 2021 – Halifax UK House Price Index
• Home prices continue to rise, but experts see a market correction ahead
• August: Rightmove Sees Prices Fall Due To Cost Of Borrowing

Nationwide said stamp duty changes drove the number of housing market transactions to a record high of almost 200,000 in June as homebuyers rushed to meet the deadline. This was around twice the number of transactions recorded in a typical month before the pandemic and 8% above the previous peak seen in March 2021. At a regional level, Wales recorded the highest house price growth at 9.8% over the past year to August, followed by Northern Ireland (8.4%). UK house prices reached a record high last month, with the average property worth £235,000 according to the house price index from Zoopla, the property portal. Rightmove also reported record average price rises for the month across all British regions as well as all market sectors, namely, first-time buyers, second-step property purchasers and so-called ‘top-of-the-ladder’ buyers. Average UK house prices increased by 10.6% in the year to August 2021, up from 8.5% recorded a month earlier, according to the UK House Price Index from the Office of National Statistics (ONS).

Falling home prices? This interactive map shows the statistical odds of it occurring in your local housing market

According to Nationwide, average UK house prices stood at £260,441 in April, rising from the £257,122 reported in March. However, since this figure is not seasonally adjusted, the uptick may in part reflect the market’s tendency to heat up in spring. Zoopla forecasts that house price growth will slow further over 2023, registering low negative annual growth by the summer and ending the year at -1%. Northern Ireland saw average annual growth of 2.7% (average house price is £186,846), Scotland saw 2.2%, (average house price is £201,489) and Wales saw growth of 1.0%, (average house price is  £216,559).

November: HMRC sees October property transactions October halve on September

In Scotland, Edinburgh has seen house price inflation of 12.9% since January, with the average house price reaching £276,831 in September. This compares to property price growth of  6.1% and 4.6% in their respective surrounding areas. Despite the annual gain, Zoopla’s price index shows a 1.3% fall in house prices over the past six months as mortgage rates and living costs have continued to bite.

Will the Housing Market Finally Recover in 2024?

The government says this risk would be mitigated by setting a cap on the number of housing association properties that can be sold, while committing to replacing each home sold. The set of standards that rented social housing must meet — the Decent Homes Standard — will be extended to private sector rented homes. The South-West posted the highest yearly price increase in England of 14.1%, followed by 13.3% in the North West. The average cost of a UK home in the first quarter of this year stood at £279,431, while earnings for a full-time employee stood at £39,402. Homes have become less affordable even since 2020, when a typical home cost 6.1 times average salary. The South West was England’s strongest performer with average properties worth £308,128, a hike of 14.2% on the year.

The Bank of England said today that its Bank base rate will remain at 0.1% at least until 16 December, when the next announcement is due. Its Monetary Policy Committee, which decides the rate, voted 7-2 on Tuesday to keep it at its current record low, where it has been since March 2020. It’s also worth noting that buy-to-let mortgages are arranged on an interest-only basis, meaning the capital debt will need to be cleared in one go at the end of the term. That could mean using the proceeds of a property sale or finding the funds elsewhere.

UPDATE 7 July 2021 – Halifax UK House Price Index

The fall in house purchase approvals in December reported by the Bank of England (see story below) largely reflects the sharp decline in mortgage applications following the mini-Budget [in September 2022]. There is still a shortage of property for sale, with numbers down by 11% in February compared to 2019. However, volumes are continuing to recover – from 15% down at the start of the year, and 30% down in the aftermath of the mini-budget in September. If the price fall prediction is accurate, this figure would come down to around £247,000. According to Nationwide, the average property now costs £257,406, down from £258,296 logged in January.

Mortgage Rates Push Higher While Home Prices Drop - Realtor.com News

Mortgage Rates Push Higher While Home Prices Drop.

Posted: Thu, 25 Apr 2024 16:20:45 GMT [source]

Home prices continue to rise, but experts see a market correction ahead

Home prices and mortgage rates show few signs of falling at the end of October, as low inventory spurs competition among home buyers. Home buying demand is also drying up as many aspiring homeowners have decided purchasing a home is simply unaffordable. “Frenzied” UK housing market activity in the first half of 2021 pushed the average price of newly-listed properties to a record-breaking £338,447, according to the latest data from property portal Rightmove. First, the price inflation experienced by the property market last summer as it emerged from the first lockdown and, second, the buying activity prompted by the government’s time-limited stamp duty holiday initiative. Halifax reported a fall in annual house price growth to 7.6% in the 12 months to July 2021.

The end of June also marked the end of the temporarily increased nil rate band to £250,000 for residential Land Transaction Tax in Wales. Also, if you’re currently tied into a fixed rate mortgage and want to take advantage of a competitive new deal, you may be penalised with early repayment charges that could wipe out any benefits from switching. The relatively high fees of £1,499 attached to some of these sub 1% mortgages might not be cost-effective if you need a relatively small mortgage.

August: Rightmove Sees Prices Fall Due To Cost Of Borrowing

Average UK house prices fell in August 2022, their first drop this year, according to the latest market data from Rightmove. Figures out today from the Office of National Statistics (ONS) show a steep decline in house price inflation in the year to June. The rate of price increase is still chunky, at 7.8%, but this compares to 12.8% recorded for the year to May 2022. Average house prices increased by 15.5% over the 12 months to July, figures out today from the Office for National Statistics (ONS) show. Halifax says property price inflation weakened across all buyer types during October, but was particularly notable for first-time buyer properties, where annual growth fell to 7.5% in October, having stood at 10.1% in September.

That makes sense considering those "bubbly" markets are the very places (see chart above) that are slowing the fastest right now. Ian Shepherdson, chief economist with Pantheon Macroeconomics, said in a report last week that tumbling demand for homes amid sharply rising mortgage rates is weighing heavily on housing prices. Winter is generally a slow season for the real-estate sector, but will it stay frozen or thaw out—and more importantly, will home prices keep rising, or fall?

According to Mr Gardner, however, a ‘relatively soft landing’ is still achievable, providing broader economic conditions evolve in line with expectations from Nationwide and other forecasters. The Office for National Statistics releases the next batch of inflation data on 20 September, the day before the Bank’s decision is revealed. The latest Bank of England decision on the Bank Rate – which currently stands at 5.25% – is due on Thursday. Analysts expect an increase to 5.5%, with the expectation that this will be the peak of the current rate increase cycle. Meanwhile, a new report from  think-tank the National Institute of Economic and Social Research (NIESR) predicts the number of mortgage holders in negative equity will rise significantly by 2025.

Many cities in the Midlands and the north of England saw a much bigger annual jump in prices, including Nottingham (3.9%), Birmingham (3.8%), Manchester (3.6% ), and Leeds (3.4%). You can find an explanation in Bethany’s article of how the market’s various house price indices are calculated, and why their average property values differ. Rightmove’s report comes against a backdrop of significant increases in mortgage rates, which is straining affordability and creating uncertainty around moving. The £82 fall in the average price of a home is the first the property portal has recorded this year – and the first seen in June since 2017 – suggesting an early start to the summer slowdown.

The NAR expects existing-home sales to fall in 2023 to the lowest level since the Great Recession in 2008, but the median price of a home in the U.S. will rise by 0.1% to $386,700. “While home prices may fall slightly over the next few months due to seasonality and surge in rates, CoreLogic does not forecast home prices to fall in 2023,” Hepp told MarketWatch. Sharga says that some 80% of today’s homeowners have more than 20% equity in their property. So, while there may be more foreclosure starts in 2024—due in part to Covid-era mortgage relief programs phasing out—foreclosure auctions and lender repossessions should remain below 2019 levels. The Midwest and South saw monthly transaction gains while the Northeast and West saw declines due to affordability challenges in those higher-cost regions. Sales of newly constructed single-family houses ticked down by a nominal 0.3% compared to January, but outpaced February 2023 sales by 5.9%, according to the latest U.S.

Oregon essentially got rid of single-family zoning in 2019,, and a similar law is moving forward in Maine. States and cities are also removing requirements that homes are built with parking spaces, which also allows for increased density of properties. The median existing-home sales price reached an all-time high in April of $391,200, up 14.8% from a year ago, according to data released May 19 by the National Association of Realtors (NAR). "Home values are falling the fastest in what were the hottest second-tier markets," Diane Swonk, the chief economist at KPMG, said in the company's 2023 housing outlook.

Over the 12 months to November, Yorkshire & Humber enjoyed the strongest annual price growth with a figure of 10.3%, nearly double that achieved in London (5.3%) which returned the weakest regional growth figure for the past year. The average price of a UK property coming to market this November fell by 1.1%, or £4,159, compared with the previous month, according to Rightmove, Andrew Michael writes. House prices rose by 9.5% in the year to September this year, down sharply from the figure of 13.1% recorded in the 12 months to August. On a monthly basis, prices fell by 2.3% in November, marking the third consecutive monthly drop Halifax has recorded, and the largest monthly decrease since 2008.

The UK average house price for September 2021 was a record high of £270,000, up from £263,000 in August 2021 and £242,000 a year previously. Figures out today from the Office for National Statistics reveal that average UK house prices soared by 11.8% in the year to September, with demand fuelled by the end of the tapered Stamp Duty holiday in England. The new figures are according to HMRC’s latest monthly data which estimates property transactions on homes worth over £40,000 (where stamp duty usually becomes payable). The average UK house price rose to a record level in November 2021, having increased by £16,000 over the past year, according to Zoopla.