According to the latest data from the Office for National Statistics (ONS), there has been a fall in UK house prices for the 3rd quarter in a row. The decline has according to the figures affected all home types and all areas of the country.
The average house price in the UK at £298,000 is down from a high in the first quarter of 2017 when average prices peaked around £291,000. The largest fall in prices is on new homes and those appealing to first time home buyers, where prices over the same period have fallen around £30,000.
Although the experts disagree on whether the market will continue to fall or whether prices will once again begin to rise, it’s clear that with the reintroduction of stamp duty and a fall in disposable income will hold back any potential increase. The latter in particular is potentially a problem as mortgages will become less affordable as interest rates begin to rise.
Lenders according to the ONS are already becoming less generous with the value of mortgages being approved having started to fall, with the average mortgage granted down from £30,000 to £328,000.
First time home buyers are the most hard hit group with an average income of less than £50,000, qualifying them for a mortgage of under £170,000 well below the £225,000 needed to buy. Those numbers are of course dependent on where you live, with city dwellers having to fork out considerably more. The North still provides better value for these buyers however the difference in price is often offset by lower wages.
By comparison the numbers required in London are double, with average prices of first time homes around £450,000 and lenders offering around £300,000 based on the higher incomes.
According to the Express, who have combined the wage and price data, the least affordable areas in the UK remain in areas around London and the South East based on the combination of earning potential and house prices.
Only time will tell whether the fall in UK house prices will continue, with potential rate rises and the likelihood of further lockdowns all making house prices difficult to predict.
Thank you for taking the time to read this article, do remember to come back and check The Euro Weekly News website for all your up-to-date local and international news stories and remember, you can also follow us on Facebook and Instagram.