HOUSE prices are likely to fall every month until the Summer but could then creep back up, a leading property association predicted today.
Reports earlier this week predicted the average home will plummet in value by more than £20,000 this year.
But although 2023 is set to be a “difficult year” for the sector, the National Association of Property Buyers (NAPB) say there are reasons to be optimistic.
Jonathan Rolande, spokesman for the NAPB, whose members purchase around £1.5bn of property annually, said: “I believe that there will be a slight recovery in January as the difficulties of 2022 fade in the memory after the Christmas break. That said, the outlook for the first half of the year is not great for prices. We should expect small drops each month for at least the first four to six months. There are reasons to be more optimistic in the second half of the year when activity should increase during the summer months.
“This will negate some of the price reduction but it’s looking very likely that by the end of 2023 there will have been no increase in prices and perhaps even a fall of up to 6%.
“But there are reasons to be more optimistic. In 2022 there were eight interest rate rises, five Housing Ministers, three Prime Ministers and four Chancellors. We had a fuel crisis, a post-pandemic slump and raging inflation. If the property market could withstand all of this, just imagine how easy things might be without such chaos. The property market has come through tougher times than this, and it will do so again.”
Mr Rolande’s comments come in the wake of reports that this year could see homeowners lose a chunk of their property’s value with prices set to plummet by 30% in some areas.
The Halifax Bank predicts prices will drop by 8 per cent this year, although this drop would not be enough to wipe away all the gains made in recent years. With the average house price in the UK £296,422 according to the latest UK House Price Index measure, that would mean the average house losing £23,713 next year.
While homeowners are set to lose out this year, those looking to get onto the property ladder could be helped by falling prices. An increase in living costs – including some mortgage outgoings – and unemployment is expected and this will add to the challenges the housing market faces. But a continued lack of houses for people to choose from is expected to continue to support house prices.
Zoopla expects sales will be supported by buyers looking for space to work from home, an ongoing spike in people retiring and – amid high energy costs – and by some people moving to properties that may be more cost-effective to run than their current homes.
Zoopla’s rival Rightmove predicts national average asking prices of new properties coming to market will be 2% lower by the end of 2023.
