British House Prices Drop 5.3% YoY, According to Nationwide
UK house prices fell by 5.3% in September compared to the same period last year, marking the largest annual decline since 2009, according to a report from mortgage lender Nationwide. This follows a similar drop in August. In terms of monthly changes, prices remained unchanged in September, following a 0.8% decrease in August.
The housing market in Britain has been losing momentum as borrowing costs continue to rise. However, the decline in house prices has not been as significant as the rapid increase of approximately 25% witnessed between the start of the COVID-19 pandemic and September 2020.
Robert Gardner, Nationwide’s chief economist, highlighted the Bank of England’s decision to keep the Bank Rate steady last month, after implementing 14 consecutive increases. This move is expected to alleviate some of the pressure faced by individuals seeking to refinance their mortgages or purchase a home.
Gardner also stated that a combination of rising wages, lower house prices, and mortgage rates could potentially improve affordability in the housing market over time. However, he cautioned that market activity is likely to remain subdued in the short term.
The report from Nationwide also revealed that transaction volumes for flats are holding up better than other types of properties. This trend may reflect the fact that prices for smaller homes did not experience the same level of growth during the pandemic.
The current state of the housing market in the UK has significant implications for both homeowners and prospective buyers. As the market continues to cool, individuals may find it more challenging to sell their properties at desired prices. On the other hand, potential buyers may benefit from the improved affordability resulting from lower prices and mortgage rates.
The future trajectory of the housing market remains uncertain, with factors such as inflation, interest rates, and government policies likely to influence its direction. As the Bank of England strives to strike a balance between stimulating economic growth and curbing inflation, its decisions will have a significant impact on the housing sector and the overall UK economy.
The Bank of England’s Monetary Policy Committee is set to meet on November 4th and 5th to make key decisions on interest rates and monetary policy measures. This meeting will be closely watched by industry experts and market participants in anticipation of any potential changes that could further shape the housing market.
Overall, while the recent decline in house prices may raise concerns for homeowners, it also presents an opportunity for those looking to enter the property market. As the market adjusts to changing economic conditions, potential buyers may find themselves in a more favorable position to secure a home at a more affordable price.
Note: This article was written in accordance with the BBC News style guide.
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