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Average House Price Falls at Fastest Rate in 12 Years

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    Average Property Price is £6000 More Affordable Than Year Before

    According to official figures from the Office for National Statistics, the average UK house price has fallen at its fastest rate in more than 12 years. The average cost of a home has dipped by 2.1% in one year, falling to £285,000 in November 2023. This means that property is typically £6000 more affordable when compared to November 2022.

    In October 2023, it was recorded that there was a modest drop of 1.3% in 12 months.

    Despite appearances, this could signal an opportune time for buyers to get a good deal on a property.

    In fact, the current UK property market has been described as a buyer’s market, with buyers having an advantage over sellers.

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      Regional Differences Show London is Worst Hit, Resilience in Other Areas

      The breakdown of different UK areas shows that while the overall market was sluggish, some regions recorded modest price increases on average.

      London recorded the lowest increase in values, with an annual decrease of 6% in November 2023. But the capital’s average house prices are still by far the most expensive of any region, meaning London property investments remain a less attractive venture than they used to be.

      Areas in the North of England were much less affected, with modest annual changes of -0.4% (North East) and -2.0% (North West).

      Learn more: Read up on some northern buy-to-let hotspots with our Buy-to-Let Burnley guide or Buy-to-Let Blackburn guide.

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      Annual Rent Increases Remain at Record Levels

      While property prices are becoming a bit more affordable, rental growth is continuing its upward trajectory at a rapid rate.

      ONS figures state that private rental prices in the UK had an annual rise of 6.2% in December 2023. They increased by the same percentage the month before, and this is the joint-highest yearly percentage change since records began in 2016.

      According to a recent report from Zoopla, the average UK renter is now paying an extra month’s rent per year when compared to 12 months before. This is due to the steep increase in rental costs, adding an average of £1200 onto the annual rent bill, which is equivalent to the average UK monthly rent.

      As the current property market is advantageous for buyers, and rental growth and demand continue growing at a conspicuous rate, the buy-to-let market seems like an enticing prospect for investors in property, especially those looking for off plan property for sale in 2024.

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        Will House Prices Continue to Fall?

        Now may be the time to look out for good deals when buying a buy-to-let property, but investors will wonder if it’s worth buying into a subdued market. When assessing buy-to-lets for sale, it’s essential to consider whether or not the property will grow in value and how quickly it is predicted to do so.

        According to The Standard, property experts Savills have weighed in on these latest ONS figures. They state that downward pressure on house prices continued into the final weeks of 2023 due to the high mortgage rates.

        However, regarding future predictions, they have observed ‘encouraging signs that buyers are gaining confidence as mortgage rates fall’.

        Savills’ Residential Market Forecast shows that the UK property market is predicted to return to healthy growth from 2026, and mainstream capital value is forecast to increase by 17.9% in the five years leading up to 2028. In particular, North England regions are set to outpace the national average. For example, the North West is forecast to grow by 20.2% by 2028.

        Further Reading: Decipher the best areas to buy in Manchester and some tips for Leeds property investment with RWinvest’s latest insights and guides!

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        Author

        Jessica Ferris

        Jessica is a property content writer at RWinvest. Keeping a close eye on the UK property market, Jessica helps our readers stay informed and up to date on the latest market news and statistics.

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