UK House Prices Plunge to 14-Year Low Amid Rising Interest Rates and Market Uncertainty
UK house prices fell at their fastest rate in nearly 14 years in May, with buyers reeling from higher interest rates and uncertainty in the market.
The annual rate of price drop picked up pace from 2.7% in April to 3.4% last month, according to lender Nationwide.
The average rate on a two-year deal rose from 5.45% to 5.49% and the average five-year, fixed-rate deal rose from 5.12% to 5.17%, the highest since January.
The Bank of England's recent figures showed a significant decline in mortgage approvals, dropping from 51,500 in March to 48,700 in April.
The building society warned that further rate hikes would strengthen the headwinds facing the already nervous market.
Commentators said that the normal "spring bounce" failed to materialise, as buyers were spooked by the threat of yet more interest rate pain.
The property market will continue to be overshadowed by heightened uncertainty over mortgages, with activity likely to stagnate and some clients putting their plans on hold.
According to the article, average property prices have been falling for the past nine months in the UK, and they are now four percent lower than their peak in August 2022.
In April, there was a brief price increase, but it is likely just a blip and not the start of a rapid recovery.
The article also mentions that approvals for house purchases were down in April and that lenders are on high alert, which is likely to cause a dry up in housing market activity and a decrease in confidence.
The average rate on a two-year deal rose from 5.45% to 5.49% and the average five-year, fixed-rate deal rose from 5.12% to 5.17%, the highest since January.
The Bank of England's recent figures showed a significant decline in mortgage approvals, dropping from 51,500 in March to 48,700 in April.
The building society warned that further rate hikes would strengthen the headwinds facing the already nervous market.
Commentators said that the normal "spring bounce" failed to materialise, as buyers were spooked by the threat of yet more interest rate pain.
The property market will continue to be overshadowed by heightened uncertainty over mortgages, with activity likely to stagnate and some clients putting their plans on hold.
According to the article, average property prices have been falling for the past nine months in the UK, and they are now four percent lower than their peak in August 2022.
In April, there was a brief price increase, but it is likely just a blip and not the start of a rapid recovery.
The article also mentions that approvals for house purchases were down in April and that lenders are on high alert, which is likely to cause a dry up in housing market activity and a decrease in confidence.