Home Insurance

House prices plummet with one area falling 60% more than average - how has your region fared?

UK house prices have fallen for the fourth consecutive month according to new figures, with only one area avoiding the plunge.

Prices dropped an average 2.4% year-on-year nationally, meaning the typical UK home now costs £285,044, according to the Halifax House Price Index. Month-on-month, house prices have dropped £1,000 on average.

However, more than £15,500 has been wiped off the typical home in the South East with average prices down 3.9% to £382,489.

That percentage drop is 63% more than the UK average.

It's a similar story for Greater London which has seen a 3.5% drop in prices annually. The typical home there now costs £531,141.

It's not just the south being impacted, with Wales seeing a 3.3% drop to £214,495.

Interest rates have been steadily rising since December 2021, with the base rate at 5.25% as of August 2023. As NimbleFins explains in our article here, when mortgage rates go up and it’s more expensive to borrow, house prices usually go down.

Rising interest rates are thought to be putting off some buy-to-let investors, but potential rental reforms are also blamed for the departure of some from the market.

Halifax says this could mean more properties become available, keeping prices lower.

But it also said first-time buyer demand was holding up “relatively well” with people choosing smaller homes to be able to meet higher borrowing costs, rather than desert buying plans altogether.

Conditions are slightly better in Scotland which has seen a 0.7% drop (£201,501) and Northern Ireland which is down 0.3% (£185,322).

The West Midlands is the only region not to see a fall in house prices - but rather than rising it is effectively flat - 0.0% - with the average home costing £250,285.

Kim Kinnaird, director of Halifax mortgages said the changes were small enough to suggest the housing market is displaying "a degree of resilience in the face of tough economic headwinds".

She said: “In particular, we’re seeing activity amongst first-time buyers hold up relatively well, with indications some are now searching for smaller homes, to offset higher borrowing costs.

“The continued affordability squeeze will mean constrained market activity persists, and we expect house prices to continue to fall into next year.

"Based on our current economic assumptions, we anticipate that being a gradual rather than a precipitous decline. And one that is unlikely to fully reverse the house price growth recorded over recent years, with average property prices still some £45,000 (+19%) above pre-Covid levels.”

Average house prices for UK regions

UK regionAverage price% Change
East Midlands£238,876-1.4%
Eastern England£333,474-2.4%
North East£167,594-1.4%
North West£223,962- 0.9%
Northern Ireland£185,322-0.3%
South East£382,489-3.9%
South West£299,649-3.3%
West Midlands£250,2850.0%
Yorkshire and the Humber£203,631-0.5%

Read more:

Helen Barnett

Helen is a journalist, editor and copywriter with 15 years' experience writing across print and digital publications. She previously edited the Daily Express website and has won awards as a reporter. Read more here.