Monthly house price fall ‘biggest in 11 years’
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UK house prices fell by 1.7 per cent last month from April - the biggest monthly dip since February 2009, according to the Nationwide.
Its latest house price index also showed annual growth slowing to 1.8 per cent from 3.7 per cent as the consequences of the market freeze began to be felt.
According to HMRC data, residential property transactions were down 53 per cent in April compared with 2019.
“The medium-term outlook for the housing market remains highly uncertain,” said Robert Gardner, Nationwide’s chief economist.
“We have already seen a sharp economic contraction as a result of the necessary measures adopted to suppress the spread of the virus.”
He said the policies put in place by the government to prop up the economy “should set the stage for a rebound once the shock passes, and help limit long-term damage to the economy.
“These same measures should also help ensure the impact on the housing market will ultimately be less than would normally be associated with an economic shock of this magnitude.”
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Ross Counsell, director at Good Move said that while the bounce back is reliant on how the wider economy performs, “the bigger challenge is how consumer behaviour has changed and how sellers need to adapt.
“For example, they will begin to adjust their expectations on the price they will achieve and may be more inclined to accept a lower offer.”
He added: “We expect to see house prices bounce back fairly soon, but flats and other similar dwellings may take a much longer time to recover.”