A quarter of homes for sale have seen their asking prices reduced, while the number of transactions is set to fall from 1.3 million to 1 million in 2023, according to Zoopla
UK house price inflation has slowed to 7.8%, the lowest growth rate recorded since November 2021.
A quarter of homes for sale have seen their asking prices reduced, while the number of transactions is set to fall from 1.3 million to 1 million in 2023, according to the latest data from Zoopla.
The real estate company expects price growth to dip into negative territory in the first half of next year as the market adjusts to weaker buying power and concerns over the economic outlook.
As many as one in 10 homes have already had a price reduction of 5% or more since September this year, with around a third of properties in the South East and East of England slashing prices to attract demand.
Zoopla found that the average price achieved in recent weeks was 3% below the asking price compared to 0% for much of 2021 and the first half of 2022.
We expect discounts to widen further in 2023, Zoopla said. History shows that when discounts reach 5-6% this points to flat to falling prices.
It’s important sellers who want to achieve a sale are realistic on selling prices and speak to agents for the right advice for their home, it said.
The slowdown comes after the chaos of Kwasi Kwarteng’s mini-budget in October, which saw the British property market stall.
Since the mini-budget, demand has fallen by 44% year-on-year, with sales down 28% compared to this time 12 months ago.
New sales have fallen by up to 50% in previous market hotspots and high-value areas where higher mortgage rates will hit buying power hardest.
This includes the mid-to-upper price bands in Southern England (excluding London), East Midlands and Wales.
Sales have fallen less in more affordable areas and London where market conditions have been weaker.
The data also revealed that more homes are coming to the market for sale overall, with the total stock of homes available up 40% compared to 2021. However, this is still almost 20% below pre-pandemic levels and rising supply will boost choice for consumers.
