"Most regions in England continue to register positive price movement, though this has fallen below 1.0% nationally."
On an annual basis, the average property sale price in England and Wales rose by just £1,300, or 0.3%, in July, according to the latest e.surv data.
This is the lowest rate of annual increase since March 2012, and is the eleventh month in succession in which the annual rate of price inflation has fallen.
On a monthly basis, the average price dropped by £370, or just -0.1%, in July. This was the seventh month in succession that the monthly growth rate has fallen, albeit at a slowing pace.
However, e.surv notes that the drop in price of £8,200 since its peak in October 2022 "must be viewed against the cumulative £38,900 rise in prices since August 2021".
In fact, average property prices have risen by around £55,400, or 18%, since the start of the pandemic in March 2020. Over the same period CPIH inflation has risen by 19% - so in real terms the average price has fallen by -1% since March 2020.
In July 2023, two of the five house price indices are showing negative annual growth - Nationwide at -3.8% and Halifax at -2.4%. e.surv says it is "interesting to observe that it is the two mortgage lender indices that are in negative territory, perhaps suggesting that those purchasing a property with a loan are looking at less expensive properties than they did in the past".
Richard Sexton, director at e.surv, commented: “Most regions in England continue to register positive price movement, though this has fallen below 1.0% nationally. There are some outliers with Hartlepool in North East registering double-digit price growth in the year. In addition, Greater London has moved from the bottom to higher ranks in the price growth league table. This disparity highlights the regional variations and complexities within the housing market.
“The recent decline in property prices in Wales can be attributed to a confluence of factors. The introduction of council tax premiums for second homes and vacant properties has created a new layer of complexity to the market. This policy shift has potential repercussions for both property prices and buyer behaviour, leading to a dampening effect on demand.
“Transactions for the first half of 2023 are at their lowest level since the financial crisis of 2007-09, reflecting the market's responsiveness to economic changes, particularly rising mortgage rates. In recent weeks, positive signs have emerged as inflation shows signs of easing along, and swap rates have stabilised following a wobble in early July, bringing some assurance to the mortgage market in the second half of the year.”
