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Is the housing market sliding, or simply re-adjusting?

Published: 14/12/2022

Whether the UK market is at the beginning of a slump or just settling after a boom, depends on who you ask.

And whether it’s a good time to buy or a good time to sell is equally open to question.

It’s been a sellers market since 2020 when the market was gripped in a post-pandemic frenzy.

But according to most reputable sources, house prices began to fall in September and continued to do so throughout the Autumn.

According to the Halifax, prices fell 2.3% in November dragging down the average price of a property to £285,579.

At the same time, the annual rate of house price growth slipped to 4.7% - down from 8.2% in October.

Halifax spokesperson, Kim Kinnaird said that the market was going through a period of ‘normalisation’ after two boom years of house price rises (up 19% since 2020).

And she pointed out that despite the fall, average house prices were still £12,000 more than this time last year and £46,000 more than pre-pandemic levels.

However other market analysts were more sombre in their forecast.

The broader economy

One said: “Things have officially gone from bad to worse in the property market, with the biggest monthly price drop since the financial crisis of 2008.

“We’re not yet in the realms of annual price falls, but if this pace continues, it won’t be long until we are.”


But is a falling house price market really a bad thing? Falling house prices can be a bit of a scary portent for the whole of the economy.

But according to the Spectator, a fall in house prices would not necessarily be a disaster.

They say: ‘It’s notable that Yougov has consistently found around half of Britons want house prices to go down, while just 5% want them to continue rising.”

And they also point out: ‘It’s also unhelpful from a personal perspective and for the broader economy for so much wealth to be locked up in property; it would be so much better if we were investing savings into productive capital to help grow the economy.’

It’s becoming as clear as mud. Maybe it depends on why you’re buying. Houses are in short supply and demand far exceeds the number of properties available. Mortgage rates took a hit after the mini-budget but they are coming down now – surely property is a good medium term investment. Yes?

Property ladder

According to Moneyweek, ‘In the past week, interest rates on two and five-year fixed rate mortgages have dropped below 6% for the first time in two months. They peaked at 6.65% after the disastrous Kwarteng Truss mini-budget. Nevertheless, borrowing rates remain significantly higher than they were this time last year (last October, the average two-year fix was 2.3%). That will make it hard for some buyers to get on to the property ladder.

So is now a good time to buy….or not?

Moneyweek says that for those who have found their dream home and have checked that the mortgage and bills are affordable, now could be a good time to buy a house.


And many experts agree that if you want to keep the house for five years or more, your investment will grow.

Savills predict a 1% growth in 2024, followed by a 7% growth in 2026 – provided lenders cut rates over the next 12 months and base rate declines as inflation falls.

And Ideal Home go further: ‘Anyone who needs to buy a home now should not get too hung up on a fall in house prices next year if their move is a medium to long term decision. If you plan to stay in your home for the medium to long term, your property will begin to rise in value again.’

Here at Dwell Leeds, we are an award-winning agency based in Leeds who aim to make the selling process simple by providing the highest levels of customer care in our industry.

For more information on our extensive services for sellers, ranging from basic to a ‘hands off’ fully managed approach, please contact us today.

We also offer an instant valuation tool to give you an estimate of how much you could sell your home for.