Home Property Finance & InvestmentMortgages Property market finished 2023 on a high as house prices are up 1.7%

Property market finished 2023 on a high as house prices are up 1.7%

by LLP Finance Reporter
5th Jan 24 1:39 pm

The property market finished on a high in 2023 as the Halifax House Price Index revealed that house prices rose by 1.1% between November and December 2023.

Halifax found that house prices rose by 1.2% on a quarterly basis and annually new figures show they were up by 1.7% in 2023.

The average house price for December rose in the third month in a row to £287,105 by £3,066 in November which is the highest level since March 2023.

The average property price is £4,800 higher than it was in December 2022, mortgage rates are also continuing to ease.

Kim Kinnaird, Director, Halifax Mortgages, said, “In December, the cost of an average UK home rose for the third month in a row to £287,105, up +1.1% or £3,066, in November, reaching the highest level since March 2023.

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“The housing market beat expectations in 2023 and grew by +1.7% on an annual basis. The average property price is now £4,800 higher than it was in December 2022. Whilst it’s encouraging that we saw growth in the last three months of the year, this was preceded with property price falls for six consecutive months between April and September. The growth we have seen is likely being driven by a shortage of properties on the market, rather than the strength of buyer demand. That said, with mortgage rates continuing to ease, we may see an increase in confidence from buyers over the coming months.

“Across all the UK regions, Northern Ireland recorded the strongest house price growth on in 2023, properties here increased by +4.1% to £192,153. Scotland saw property prices increase by +2.6% to £205,170. At the other end of the scale, the South East fell most sharply, houses here now average £376,804 (-4.5%), a drop of –£17,755.

“As we move through 2024, the UK property market will continue to reflect the wider economic uncertainty and buyers and sellers are likely to be naturally cautious when considering making a move.

“While wage growth is now above inflation, helping to ease cost of living pressures for some and improving housing affordability, interest rates are likely to remain elevated for as long as inflation remains markedly above the Bank of England’s target. Our latest forecast suggests house prices could fall between -2% and -4% during the coming year, although, as with recent years, forecast uncertainty remains high given the current economic climate.”

Foxtons CEO, Guy Gittins said, “The latest figures provide further proof that despite a tough year, the UK property market has seen 2023 out on the front foot, recording a third consecutive monthly increase in the rate of house price growth and finishing the year with positive annual growth.

This growing positivity has no doubt been bolstered by the resulting stability of a freeze on interest rates and the market is now poised for what we expect to be a much better year.”

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