"Today marks the largest monthly fall in house prices since 2009 as the pandemic starts to take its toll on the economy and therefore housing market"
Ross Counsell, Director at Goodmovecouk
Today saw the release of the Nationwide HPI and the Bank of England mortgage approval updates.
Both saw a decrease due to Covid-19. Thought leadership on both is below:
Nationwide House Price Index:
Today marks the largest monthly fall in house prices since 2009 as the pandemic starts to take its toll on the economy and therefore housing market.
Annual house price growth has slowed to 1.8%, 1.7% down month on month, a much different picture to the positive momentum we saw in early 2020.
These numbers are largely down to the reduction in market activity due to social distancing measures, and is a real tell-tale sign for the future of home buying.
The bounce back in the housing market is reliant on how the wider economy performs, however, the bigger challenge is how consumer behaviour has changed and how sellers need to adapt to continue to sell their properties. For example, they will begin to adjust their expectations on the price they will achieve and may be more inclined to accept a lower offer.
Buyers are now putting more importance on aspects such as outdoor space which will mean a divide in how properties sell.
We expect to see house prices bounce back fairly soon, but flats and other similar dwellings may take a much longer time to recover.
Bank of England’s Money and Credit release:
Today’s mortgage approval and Nationwide HPI update spell a bleak output for the housing market.
House prices have fallen along with mortgage lending.
Over the short-medium term, mortgage lenders will require larger deposits and may shift the parameters of their stress tests/affordability calculations – this combined with job losses and income uncertainty will take some buyers out of the market.
The government needs to release its exit plan in more detail as the uncertainty is holding buyers and sellers back. Until this happens updates like today's will unfortunately continue.
Full infomation at https://goodmove.co.uk/