The average value dropped by 0.1 percent, the Nationwide Building Society said on Friday. It was the fourth time in a row prices dropped month-on-month, and means values are only 2.8 percent higher than they were 12 months ago.
Nationwide said the average home sold for £262,068 during December, down by a little over £1,700 compared to November.
Its chief economist Robert Gardner said: “December saw a further sharp slowdown in annual house price growth to 2.8 percent from 4.4 percent in November.
“Prices fell by 0.1 percent month-on-month – a much smaller decline than in the previous couple of months.
“However, December also marked the fourth consecutive monthly price fall – the worst run since 2008, which left prices 2.5 percent lower than their August peak.”
Mr Gardner said there were still reasons to be cheerful for potential sellers looking into the New Year.
Interest rates on home loans are easing back from the high levels they reached after September’s adverse mini-budget. Meanwhile, wages are growing fairly rapidly, at about seven percent, so people might spend more on homes. However, the pay rises are still lower than inflation.
Mr Gardner added: “The main factor that would help achieve a relatively soft landing is if forced selling can be avoided, and there are good reasons to be optimistic Most forecasters expect the unemployment rate to rise towards five percent in the years ahead – a significant increase, but this would still be low by historic standards.
“Moreover, household balance sheets remain in good shape with protection from higher borrowing costs, at least for a period, with around 85 percent of mortgage balances on fixed interest rates.” The slowdown in the annual increase was noticeable over the last three months of 2022. It slowed most in the southwest, but also in Scotland and elsewhere.
Matthew Thompson, head of sales at Chestertons, said that the market had been supported by “seasoned buyers” in December, with first-time purchasers and second steppers awaiting new year developments.
Post source: Express