House prices fall for first time in 8 years

HOUSE prices have fallen for the first time in eight years, according to Nationwide, Britain’s biggest building society.

The price of a typical three-bed semi was down 0.1 per cent compared with the same time last year.

It is the first time the annual price changes have slipped backwards since December 2012.

Month-on-month figures reveal the average house lost £2,500 last month, with values now at £216,403, down 1.4 per cent.

The slide in June was slightly smaller than May’s 1.7 per cent, which was the biggest monthly drop in more than 11 years. Before that all regions had seen modest growth this year.

The housing market, which ground to a halt after the UK went into lockdown at the end of March, reopened in mid-May, with estate agents allowed to do viewings.

But the effects of the economic shock are starting to filter through to prices now.

Jonathan Hopper, of Garrington Property Finders, said: “Every light on the Nationwide’s property price dashboard is now glowing red. Prices have started to fall on a monthly, quarterly and an annual basis. So far this is a hard reset for the market rather than a collapse.

“The gains of the ‘Boris bounce’ seen at the start of the year have been swept away, and the market is transitioning to the ‘new normal’.

“With estate agents across the UK at last able to conduct viewings, both buyers and sellers are feeling their way on price.

“While the full financial impact of the pandemic has yet to feed through into the wider economy, in the property market the mood among buyers is best summed up by the two c’s – caution and curiosity.”

Nationwide said on a seasonally adjusted basis, house prices in June were 3.2 per cent down on April.

The society’s chief economist Robert Gardner said: “It’s unsurprising that annual house price growth has stalled, given the magnitude of the shock to the economy as a result of the pandemic.”

The medium-term outlook remains “highly uncertain”, but he added: “The raft of policies adopted to support the economy, protect businesses and jobs should set the stage for a rebound.”