The UK housing market is facing continued downward pressure on its prices, with the average house price falling by 1.9% in August 2023, the largest monthly fall since November 2022.
This is according to the latest figures from Halifax, which show that house prices are now down by 4.6% on an annual basis, the biggest year-on-year decrease since 2009.
The South East is experiencing the biggest drop in house prices, with prices down by 5.0% on an annual basis. This is due to buyers facing the need to find larger deposits and fund bigger monthly repayments, as mortgage rates have risen sharply in recent months.
London remains the most expensive place in the UK to purchase a home, with an average property price of £529,814. However, with prices down by 4.1% over the last year, it has seen the biggest fall of any region in cash terms (-£22,777).
The housing market is expected to remain subdued for the rest of this year and into next, with further downward pressure on prices anticipated. However, it is important to remember that prices remain some £40,000 (+17%) above pre-pandemic levels.
What does this mean for South London homeowners?
If you are a homeowner in South London, you may be feeling concerned about the falling house prices. However, it is important to remember that the market is expected to rebalance until it finds an equilibrium where buyers are comfortable with mortgage costs in a higher range than seen over the previous 15 years.
In the meantime, there are a few things you can do to protect your investment:
- Ensure your mortgage is in good order. If you are on a variable rate mortgage, consider switching to a fixed rate to protect yourself from further interest rate rises.
- Make any necessary repairs or improvements to your property. This will help to maintain its value and make it more attractive to potential buyers in the future.
- Be realistic about your asking price if you are planning to sell. Buyers are becoming increasingly price sensitive, so it is important to be competitive.
If you are thinking about buying a home in South London, the current market conditions could present an opportunity to get a good deal. However, it is important to do your research and speak to a financial advisor to ensure you can afford the monthly repayments.