House prices in the UK fell for the fourth consecutive month, the longest period since 2008 | housing market

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UK property prices fell for the fourth consecutive month in December, the longest streak of declines since 2008, according to Nationwide.

Annual house price growth also slowed sharply as the year drew to a close, the lowest rate since mid-2020, with all regions of the country affected, according to the Building Society’s monthly survey.

The average property price fell 0.1% on the month to £262,068 – a much smaller decline than in the previous two months – leaving prices 2.5% below their August peak, after factoring in seasonal effects.

Nationwide said the annual growth rate slowed to 2.8% in December from 4.4% in November. This is the lowest since July 2020, when it was 1.5%.

House price growth slowed across all UK regions, particularly in the South West of England, where the annual rate fell from 12.5% ​​to 4.3% in the most recent quarter, while in Wales annual growth slowed from 12.1% to 4.5%. England overall posted a rate of 4.8%, down from 9.9%, and London was the English region’s weakest performer, with annual growth easing to 4.1% from 6.7% in the third quarter.

Jeremy Leaf, a North London estate agent and former RICS Residential Head, said: “The drop in house prices is not surprising given the sharp rise in the cost of living and especially interest rates. Prices could fall further as concerns about job security grow and uncertainty will remain. Until the mortgage payments are seen to be stable.

“However, the housing market remains supported by strong job prospects, inventory shortages and lender tolerance, which reduces mortgage default risk and prevents a further decline in home prices.”

While the housing market is expected to cool further in the coming year and some experts predict sharp declines in home prices of up to 12%, Robert Gardner, chief economist for Nationwide, expects a more moderate decline in values ​​of about 5%.

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“The key factor that would help a relatively soft landing … is that a forced sell can be avoided, and there are good reasons for optimism on that front,” he said. Most forecasters expect the unemployment rate to rise to 5% in the coming years – a significant increase but that would still be low by historical standards. Moreover, family budgets remain in good shape.”

Matthew Thompson, head of sales at Chestertons Estate Agents, said that while cash buyers and “seasoned buyers” tried to make purchases in December, “first and second time buyers were more hesitant and decided to watch how the market could develop in the new year.” He added that valuations have declined compared to previous months, which will lead to a decrease in the number of properties offered in the market during the first quarter of 2023.

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