UK house prices fall at fastest rate since 2009

House prices fell by 5.3% in the year to August, according to Nationwide, the fastest annual drop in 14 years. The bigger-than-expected drop brings the average house price down £14,600 to £259,153 compared with a year ago. “The softening is not surprising given the extent of the rise in borrowing costs in recent months, which has resulted in activity in the housing market running well below pre-pandemic levels,” said Robert Gardner, the chief economist at Nationwide. The number of completions of house sales was down 20% in the first half of the year compared with 2019, and about 40% down on 2021. While the proportion of people buying with cash has remained strong, the number of completions by those requiring a mortgage has plummeted. There was also a 25% drop in first-time buyers in the first half of 2023 when compared with 2019, Nationwide said, while buyers turned their attention from detached homes to smaller, less expensive properties. 

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