Average UK house prices fell 0.1% to £293,835 in September as the housing market showed further signs of cooling, albeit marginal.
“The average UK house price experienced a slight fall in September (-0.1%), the second marginal decrease over the past three months. The cost of a typical home edged down a little to £293,835 from the previous month’s record high (£293,992). The pace of annual growth also slowed for the third month in a row, to +9.9% from +11.4%, returning to single-digits for the first time since January,” said Kim Kinnaird, Director, Halifax Mortgages.
However small September’s decline was, recent economic developments point to further house price declines in the near term. The new Uk government’s shambolic fiscal package sent UK gilts soaring and ravaged the UK mortgage market. New fixed rate deals are currently around 6%, a huge jump for those coming to the end of their current terms.
The Bank of England is set to make another significant increase to the base rate at their next meeting.
“House prices fell slightly last month, reflecting the fact that demand was already falling earlier this summer – well before the mini-budget tipped the mortgage market into chaos. Once September’s rate hikes feed through into sales figures in the coming months, the risks of more significant house price falls will build,” said Sarah Coles, senior personal finance analyst, Hargreaves Lansdown
“It’s not a big month-on-month fall, but it’s the second in three months, and the quarter has seen the slowest growth in a year, so we’re definitely seeing a cooling in the market. September prices reflect decisions in June, when estate agents were reporting lower demand for the second consecutive month, and sales were slowing. In the RICS residential market report at the time, there were plenty of comments from agents who saw buyers start to drift away, and those who remained were more cautious.”