Published on 16.06.2023

First time in 11 years since prices of real estate have fallen in Britain

House prices in the UK will continue to fall in the near future, so buying real estate now could be a good investment. According to Halifax, the cost of apartments and houses in the country have fallen for the first time since 2012.

The price decrease was 1% compared to 2022. In May this year prices have dropped by £3,000 compared to the same period in 2022, and by £7,500 compared to August last year. The average price of a home in the UK is now £286,532. Prices have fallen in the south of the country, where most of the population is concentrated. All other regions, except for Wales, recorded a slowdown in annual price growth.

The drop in prices is due to stagnation in the real estate market, experts say.

According to UK Finance, UK residents prefer to take a mortgage for a longer period of time, thereby reducing their monthly repayments. In this case, one in five customers take out a mortgage for a period of over 35 years. Banks are forced to raise the rate in order not to lose money.
The UK economy continues to struggle with the effects of high inflation. The Bank of England is forced to raise its key rate, against which mortgage rates in the country as a whole are rising. This has a negative impact on purchasing power. Separate data also point to the rising cost of living, which may reduce people's ability to save and buy property. According to UK Finance, the amount saved in the savings accounts of British residents have fallen in the first three months of 2023, the first decline in 15 years.
Now the mortgage rate for a two-year deal is 5.79% and 5.47% for a five-year deal. This rate is much higher than it was back in December 2021.
Whether you’re looking to invest or buy a property in the UK for personal use, we’re here to help
Amit Seth
Managing Director