House prices remain stable but are still down 3.5% compared to June 2022, latest figures from Nationwide show.
The building society’s housing price index (HPI) shows prices rose by a modest 0.1% in past month, reversing the 0.1% decline seen in May.
London saw a 4.3% year-on-year decline, while in the surrounding Outer Metropolitan region, prices fell by 2.9% compared to Q2 2022.
Across northern England overall (which comprises North, North West, Yorkshire & The Humber, East Midlands and West Midlands), prices were down 2.7% compared to the same period last year.
Meanwhile southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) saw a 3.8% decline.
The report also noted that house prices remain high relative to earnings, and as a result, deposit requirements are still a significant barrier for those looking to enter the market.
The HPI revealed that a 10% deposit on a typical first-time buyer home is equal to around 55% of gross annual income.
Commenting on the figures, Robert Gardner, Nationwide’s Chief Economist, says: “Providing the labour market and interest rates perform broadly as expected, we are unlikely to see the waves of forced selling which would probably be required to result in a more disorderly adjustment to the housing market.”
Benham and Reeves Director Marc von Grundherr, says: “Higher interest rates are causing an increased level of unpredictability and the nation’s homebuyers don’t know whether they’re coming or going at present.
“This is evident when it comes to current house price performance, with property values remaining largely unchanged from one month to the next.”
Barrows and Forrester’s managing director James Forrester says: “Borrowing costs have risen significantly in recent months but while they may have reached similar levels to those that followed last September’s shambolic mini budget, the market isn’t feeling the same degree of strain and buyer activity is building, albeit at a more measured pace.”
Property lender MT Finance’s managing director, Gareth Lewis, says: “These figures are unsurprising; we didn’t expect a sudden fluctuation in values either up or down.
“With purchase applications up, people are still willing to commit but recent reports suggest sellers are taking a haircut on values which hasn’t been the case for a long while.
“Concern with affordability and rate rises means buyers can be a little more aggressive in their offers which is why prices aren’t really moving.
“Properties are taking longer to sell; whereas before they wouldn’t be on the market for long, now they are sitting there for a reasonable period of time. “
Mantra Group’s managing director Nimesh Sanghrajka says: “We’ve got to accept that the era of rock-bottom rates on mortgages is over for the foreseeable future and the housing market is feeling the impact of that.”
