Britain house prices may decline by 8% this year, says Halifax

Bloomberg

UK house prices are on track to drop 8% this year after declining for four months in a row, one of the nation’s biggest mortgage lenders said.
Halifax said its measure of property prices fell 1.5% last month after a 2.4% decline in November. The figures are similar to a reading from Nationwide Building Society, which last week reported the longest slump in prices since 2008.
Soaring interest rates and a tightening cost-of-living squeeze are weighing on the property market. The average cost of a home was £281,272 ($334,780), according to Halifax, down 4.3% from a peak of £293,992 in August.
“The housing market will
continue to be impacted by the wider economic environment,” said Kim Kinnaird, director at Halifax Mortgages.
“As buyers and sellers remain cautious, we expect there will be a reduction in both supply and demand.”
Prices over the whole of 2022 rose 2%, reflecting gains in the first half of the year when buyers were snapping up properties outside city centers with space to work from home.
Halifax said prices are now falling in every region of the UK. The north east of England saw the biggest slowdown in the annual pace of growth, falling 4 percentage points in December to 6.5% annual growth.
Northern Ireland, which also has been a hot spot in recent months, cooled to 7.1% annual growth from 9.1% in November. In London, prices are up 2.9% from a year ago in December, down from 5%.
“These trends need to be viewed in the context of historic prices,” Kinnaird said. “The cost of the average home remains high – greater than it was at the start of 2022 and over 11% more than house prices at the beginning of 2021.”
The Bank of England has increased its benchmark lending rate nine times since December 2021, putting it at 3.5%, the highest since 2008. Investors
anticipate another 1 percentage point of hikes this year.