LONDON (Reuters) January,6 – British house prices fell in December, recording their biggest quarterly decline since the financial crisis more than a decade ago, data from mortgage lender Halifax showed on Friday.
According to Halifax, average home prices fell 1.5% month-on-month in December, the fourth straight month of decline, after he fell 2.4% in November.
On a quarterly basis, home prices fell 2.5%, the steepest decline in the three months to February 2009.
According to Halifax UK house prices have fallen fastest since February 2009.
Other housing market indicators also show a sharp slowdown in the housing market, reflecting rising interest rates and a weakening economy as households struggle with rising costs of living.
Bank of England data on Wednesday showed lenders approved far fewer home loans than expected in November. Bond market turmoil triggered by former Prime Minister Liz Truss’ short-term tax cut plan also prompted many lenders to withdraw their mortgage offers in October.
“Real estate prices are likely to continue to fall for the foreseeable future,” said Martin Beck, an economist at consultancy EY ITEM Club.
Halifax expects home prices to fall by 8% in 2023, which would mean a return to levels last seen in April 2021.
Real estate prices rose immediately after the outbreak of the COVID-19 pandemic. Temporary tax incentives drove a rush to buy larger homes with gardens.
The annual rate of increase in house prices fell to 2.0% from 4.6% in November, the lowest since October 2019, according to Halifax. Halifax director Kim Kinnaird said: “As the housing market continues to be impacted by the broader economic environment in 2023, and buyers and sellers remain cautious, both demand and supply will continue to be optimistic overall.
