Biggest House Price Fall for 14 Years - with 'Significant' Further Drop Expected

THE TELEGRAPH: Property values are now down 5.3pc from their peak, as interest rate rises bite

House prices have fallen by close to £15,000 in the biggest annual slump for 14 years.

Property values are down 5.3pc from their peak in August last year, leaving the market in its weakest state since 2009, new figures show.

Economists warned the drop marked the start of further “significant” falls to come.

A typical home has lost £14,600 of its value in the past 12 months, following a sharp rise in mortgage rates and a cooling in the market, according to Britain’s biggest building society Nationwide. » | Tom Haynes | Friday, September 1, 2023

The Two Charts That Spell Big Trouble for Britain's Housing Market

THE TELEGRAPH: Nationwide Building Society has provided the latest snapshot of Britain's abruptly slowing housing market, with annual growth now at its lowest in four years.

The building society's economists chose this latest bulletin to touch on a disconcerting trend: the fact that while mortgage rates continue to reduce sharply, the "affordability" of property - as measured by the amount of income borrowers are committing to mortgage repayments - is not improving. In some areas it is deteriorating.

This reflects a period of static wages against rising house prices and a growing willingness of borrowers to stretch themselves, Nationwide's economists suggested. Read on and comment » | Richard Dyson | Friday, April 28, 2017

Middle Classes Will Disappear in Next 30 Years Warns Government Adviser

THE DAILY TELEGRAPH: Property price rises will cause the middle classes to disappear within 30 years, leaving only a “wealthy elite and sprawling proletariat”, government adviser says

The middle classes will die out within 30 years because of rising property prices, which will rob today's children of their dreams, an economist has warned.

David Boyle, a government adviser and fellow of the New Economics Foundation think tank, said that youngsters can no longer expect the same level of affluence as their parents.

Speaking at the Hay Festival he warned that Britain will be left with a "tiny elite and a huge sprawling proletariat" who have no chance of "clawing their way out of a hand-to-mouth existence".

He predicted that the average house price will reach £1.2 million by 2045, putting a home beyond the range of most people as wages fail to keep up with huge increases.

Mr Boyle said that the traditional middle classes will need three or four jobs just to be able to pay soaring rents. People will no longer have the space or time to pursue cultural interested [sic]. » | Sarah Knapton, Science Correspondent | Wednesday, May 26, 2014

Germany – Troubling Trend: Shrinking Population Triggers Explosion in Vacant Homes
SPIEGEL ONLINE INTERNATIONAL: While home prices in Germany's urban areas are skyrocketing, the opposite trend can be seen in less densely settled regions. There, shrinking populations are creating housing surpluses and vacant homes in a trend that experts say will soon spread across the country as its population grows grayer.

For now, things in the Altenwalde district of Cuxhaven, a port city of 52,000 residents in northeastern Germany located near the mouth of the Elbe River, still look prim and proper in that sort of Playmobil tidiness that Germans love. The little houses are packed in close together into the kind of orderly settlement one can find in thousands of places across Germany.

One-third of all of the residential structures in western Germany are single- or two-family homes built between 1950 and 1978. These were the dream houses meant to offer their owners peace, quiet and financial security. But now Germany is undergoing a generational change. There are fewer young people and more old ones, and grandma's little house has gone from being a wise investment to a money loser.

One can already see the signs of this tectonic shift in Altenwalde. It isn't everywhere, but it still can't be missed. There are houses with empty window panes, closed shutters, empty driveways and overgrown gardens. These are symptoms of being vacant or of only being inhabited by a single, usually elderly person who cannot afford to, doesn't have the energy to or simply doesn't care to keep things up. Indeed, demographic change has arrived in Germany's famously idyllic suburbs. » | Christian Tröster | Friday, November 09, 2012

Housing Rebound 'Runs Out of Steam'
THE DAILY TELEGRAPH: House prices fell at their fastest pace for six months in April as a recent rebound in the housing market "ran out of steam" following the ending of a stamp duty concession for first-time buyers, the Royal Institution of Chartered Surveyors said.

The number of newly agreed sales has weakened, with a balance of 6pc of chartered surveyors across the UK reporting decreases rather than increases in sales in April, the first time transaction levels have entered negative territory since last September.

Some 19pc more surveyors reported house price falls rather than rises and a balance of 17pc believe that prices are set to drop further, the Royal Institution of Chartered Surveyors (Rics) said.

London, which has had strong demand from overseas buyers, was the only region to report a general rise in prices, while the West Midlands and Wales experienced the worst price deteriorations, the study said.

The situation for Scotland remained largely unchanged, while Northern Ireland continued to see a deterioration. Read on and comment » | Tuesday, May 08, 2012

US Home Prices Drop Amid Weak Demand
BBC: US home prices dropped more than expected in November, continuing the market's slide in an index of 20 metropolitan areas.

Prices for single-family homes declined 0.7%, instead of the 0.5% forecasted by economists.

Home prices are on average at similar levels to 2003, amid a large supply of houses with weak demand.

Consumer confidence also slipped in January, after two straight months of gains in confidence in the US economy. » | Tuesday, January 31, 2012

House Prices Fall as Nationwide Warns of Sluggish 2012
THE DAILY TELEGRAPH: House prices in Britain dipped in December, mortgage lender Nationwide said on Friday, adding that the property market looks likely to remain sluggish next year as a weak economy and rising unemployment keep a lid on consumer spending.

House prices fell 0.2pc from November on a seasonally adjusted basis, although they rose 1pc from the same month last year. In a Reuters poll, analysts had forecast a monthly increase of 0.1pc and a 1.5pc annual rise.

"With the UK economy struggling to gain momentum, labour market conditions are likely to remain challenging in 2012, deterring buyers from entering the housing market," said Nationwide chief economist Robert Gardner.

"The housing market in 2012 looks likely to be characterised by low levels of activity once again, with prices moving sideways or modestly lower over the course of the year," he said. » | Reuters | Friday, December 30, 2011

EU Rules to Slash House Prices
DAILY EXPRESS: A BID by the EU to restrict Britain’s mortgage market would see house prices plummet, experts warned ¬yesterday.

The new rules would dry up funds and force hundreds of thousands of people to sell up.

The glut of homes on the market would then see supply outstrip demand, causing prices to crash.

Brussels bureaucrats want to bring the UK’s crucial buy-to-let sector into line with Continental practice. That would mean landlords could no longer get a buy-to-let mortgage based on rental income.

Instead they would have to rely solely on their personal income. There are about 1.5million buy-to-let mortgages in the UK. Many landlords use second properties to back up their pension. » | Sarah Westcott | Saturday, November 12, 2011

A Little-noticed Milestone: This Week, House Prices Will Have Fallen Over 30 Per Cent in Real Terms
TELEGRAPH – BLOGS – ANDREW LILICO: Unless something odd happens, this week is likely to see an interesting but under-announced milestone: falls in house prices, in real terms, from their 2007 peak, exceeding 30 per cent (on the well-known Halifax measure). In cash terms, house prices peaked in August 2007, and fell 22 per cent to March 2009. After picking up a little in the second half of 2009 and early 2010, they went back to falling from mid-2010, and have been broadly flat during 2011.

But because inflation is high, that flat performance in cash terms for housing in 2011 means that, after adjusting for inflation, house prices have been falling apace. In real terms, since January 2010, house prices have fallen a further 12 per cent. » | Andrew Lilico | Monday, June 27, 2011