Lloyds says house prices fell by -1.2% in one year, the biggest fall since October 2023

Seller are now begining to realise that the buyers are in control in this market. With many landlords looking to offload properties as well it is a hard time to sell. The government have made it clear they want to help first time buyers and developers but the rest of the market is on their own. With no stamp duty changes announced in the budget the slump may continue.

A 1.2% annual fall doesn’t sound like much but when considering inflation is rising month on month, and wages continue to rise, the affordability gap is being closed. The affordability gap is being closed and this is good news for those considering their first purchase. Prices now are at a level comparable with 20 years again when adjusted for inflation, and that is an early Christmas present for registered buyers.

A 1.2% annual fall is not a housing crash, but it does show how price-sensitive the market has become. Buyers have more negotiating power than they did, while sellers need to price realistically rather than anchor themselves to what a neighbour achieved a year or two ago.

For buyers, I would not try to time the bottom of the market. A small saving on the purchase price can easily be wiped out by a higher mortgage rate, so affordability and the right property matter more than guessing what the index will say next month. If you find the right home at a sensible price and the mortgage is affordable, falling prices can actually create an opportunity rather than a reason to sit on the sidelines.

This is clearly a softer set of numbers and reflects what we are seeing on the ground. Buyers are still there, but they are more cautious, more price-sensitive and far less willing to stretch beyond what feels comfortable.
For buyers, this is not necessarily bad news. A quieter market can create more room to negotiate, but the real issue remains the cost of borrowing rather than whether a property is 1% cheaper than it was last year.
For sellers, realism is crucial. Homes that are priced sensibly can still sell, but aspirational pricing is becoming harder to sustain.
This is a market that is still taking its foot off the accelerator, not driving over a cliff.”

One claim recent governments can both applause themselves for is the decimation of the housing sector whether that he sales or rentals. There is buying activity but due to the lengthy delays, many first-time buyers are opting for vacant chain free options so little else is moving. Prices are being renegotiated, people changing their mind last minute, rehagas not moving out when a landlord wants to sell- all in all it’s a mess.