In June 2023, Nationwide announced the average price of homes had fallen again, with a 0.8% decrease taking the average price to £271,619. This change represents the biggest monthly drop in property values in two years. The slowdown in growth is more a signal of changing market conditions and demand, especially after a recent overhaul of stamp duty.
Where price growth is concerned, the annual growth rate slowed to 2.1% in June, down from 3.5% seen in May. This change has prompted alarm bells for analysts about demand weakening. Robert Gardner, Chief Economist at Nationwide, noted that the recent increase in stamp duty wouldn’t come into effect until April. He argued that this change helped to explain the recent softening in price appreciation.
February 2023 marked the largest monthly decline in house prices. This trend continued during the summer months. East Anglia has seen the lowest increase, up only 1.1%. This really serves to underscore the shocking regional inequities in performance across the UK.
Yet, Northern Ireland remains the top performer in terms of annual house price growth. In Q2 of this year, it had an astounding 9.7% jump! This is a significant drop from the 13.5% increase registered in the first quarter. It appears that the breakneck speed of growth is leveling off.
The north-south divide in house price performance has reduced significantly over this quarter. Of all dwelling types, terrace houses recorded the largest increase in property values year-on-year. Yes, in fact, they went up by an astonishing 3.6%! At a 3% yearly increase, semi detached homes weren’t too far behind, while detached homes saw an increase even higher, with a 3.2% increase in the price of homes.
Scotland demonstrated remarkable positive resilience too, with house prices increasing by 4.5% annually. In comparison, Wales saw a much smaller increase of 2.6%. Typically measured through the Nationwide index, in England, house prices rose by 2.5%, below the 3.3% recorded in the first quarter of 2023. Perhaps most interesting was the profound change of flats by the 0.3% increase in home prices — down massively from 2.3% as in June to slightly lower.