UK house prices have fallen 1.4% year on year, however, on a monthly basis they have shown signs of positivity with a 0.1% increase.
This is according to the latest government data in its UK House Price Index for December published today.
The average price of a property in the UK was £284,691 (down 1.4%).
London saw the largest annual reduction in house prices at -4.8% although monthly growth remained flat at 0%.
Commenting on the latest figures Open Property Group chief executive Jason Harris-Cohen said:“A monthly uplift in house prices during December, regardless of how marginal, is a very promising sign given the usual seasonal lull. This slight increase provides the first evidence that the mortgage market resurgence in both approvals and approval based house price growth is starting to filter through to sold prices”.
He added: “The further positive to take is that while sold prices had been in decline since the summer, this is very much the ‘light at the end of the tunnel’ phase of this brief house price correction.”
Atom Bank head of mortgages Richard Harrison said the news of a 1.4 % decrease in house prices in December came as little surprise.
“A seasonal dip in asking prices is always expected in the lead-up to Christmas, and the final month of 2023 saw vendors becoming increasingly competitive, reducing their pricing in the hope of closing a sale before the New Year.
“Likewise, higher mortgage rates and stretched affordability for some buyers may have motivated them to offer below the asking price, in a bid to offset the impact of higher borrowing costs”.
He added: “More recent indicators point to increasing house prices as confidence in the market improves, and we should see this reflected in future ONS data. The festive period was in fact a turning point, with more than 10,000 new properties coming to the market on Boxing Day – the biggest number of new sellers in one day since 2011, according to Rightmove”.
These views are broadly echoed by MT Finance managing director Gareth Lewis: “These are the figures we were expecting, with a flat market and decrease in transactions resulting in softening values. It is no surprise given fluctuating rates and product availability last year.
“Since then we have seen more consumer confidence, which has meant agents are busier, people are looking to transact and having conversations about buying and moving”.
He concluded: “As the next set of data comes through, we should see transactional volumes improve and values edge up as ultimately there is more demand. What we don’t want to see is values go too high or too fast – the market needs a period of relative calm so that buyers and sellers can get back to transacting property in a measured way.
