Home > News > UK house prices drop 5.3% with falls in every region

UK house prices drop 5.3% with falls in every region

UK house prices fell by 5.3% in the year to September, with drops in price in every region of the country as rising interest rates squeeze the market.

The house price index by Nationwide, the biggest British building society, showed that seasonally adjusted prices stalled over September, after a 0.8% drop in August.

The price of an average home was £257,808 in September, nearly £14,500 lower than a year earlier.

The housing market in Britain has slowed in recent months as the Bank of England has raised interest rates sharply to combat a surge in inflation triggered by coronavirus pandemic disruption after Russia’s invasion of Ukraine, which sent energy prices soaring.

The Bank responded with a series of interest rate rises that remained unbroken until last month. The September meeting of the Bank’s monetary policy committee was the first time in almost two years that it left rates unchanged, giving hope for an end to further rises in borrowing costs.

However, the effects of the rate rises remain clear in the housing market. According to the latest data from the Bank of England, only 45,400 mortgages were approved for house purchase in August. Nationwide said that figure was about 30% below the monthly average in 2019 before the pandemic and the consequent volatile period in the housing market.

Nationwide’s chief economist Robert Gardner said: “This relatively subdued picture is not surprising given the more challenging picture for housing affordability. For example, someone earning an average income and purchasing the typical first-time buyer home with a 20% deposit would spend 38% of their take-home pay on their monthly mortgage payment – well above the long-run average of 29%.”

Samuel Tombs, the chief UK economist at Pantheon Macroeconomics, a consultancy, said there had been a “severe blow to affordability from higher mortgage rates”, but that recent consumer confidence increases could buoy demand after a few more months of downturn.

HICH LTD has continually raised the quality standards in the UK property survey market. Our multi-award-winning property survey service has made us the leading reference in the property survey market.

We offer property survey services of the highest quality. Using state-of-the-art equipment, we provide excellent property surveys at affordable prices. Our prices are based on the number of rooms rather than the value of the properties, so you will always get the best value for money with our services.

Please look at our Trustpilot page and see why customers have chosen us as their favourite property survey provider!

At HICH LTD, we work to serve our clients and make the world a better place for everyone. We actively collaborate with NGOs to promote environmental, social, and charitable causes. If you want to know more about our efforts or how you can help, contact us at admin@hich-ltd.co.uk.

HICH LTD extends a warm invitation to contractors and service providers throughout the UK to join our network; by joining the Contractors and Service Providers Network, you will enjoy benefits such as a significant increase in customer flow, advertising on our high-traffic website, and direct contact with thousands of customers in your postcode area. Find more information here or by following the QR code in the video.