House prices in the UK dropped last month by the biggest amount in 14 years - but the North East was the only exception to the trend of falling property prices across the country.
New data from Halifax's House Price Index, the longest-running monthly house price analysis dating all the way back to January 1983, found that prices fell for the third consecutive month in November in the largest drop since October 2008. The average price for a property in the UK now stands at £285,579, with prices last month falling by 2.3% as the rate of annual house price growth slowed from 8.2% to 4.7%.
But the North East is the only area in the UK which saw its rate of annual house price growth go up rather than drop last month, rising slightly from 10.4% to 10.5%. It's also the one area of the country where annual house price inflation is in double figures, with a typical property in the region now costing £173,587.
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Kim Kinnaird, director at Halifax Mortgages, said of the findings: “While a market slowdown was expected given the known economic headwinds – and following such extensive house price inflation over the last few years (+19% since March 2020) – this month’s fall reflects the worst of the market volatility over recent months. Some potential home moves have been paused as homebuyers feel increased pressure on affordability and industry data continues to suggest that many buyers and sellers are taking stock while the market continues to stabilise.
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“When thinking about the future for house prices, it is important to remember the context of the last few years, when we witnessed some of the biggest house price increases the market has ever seen," the director explained. "Property prices are up more than £12,000 compared to this time last year, and well above pre-pandemic levels (+£46,403 vs March 2020).
“The market may now be going through a process of normalisation. While some important factors like the limited supply of properties for sale will remain, the trajectory of mortgage rates, the robustness of household finances in the face of the rising cost of living, and how the economy – and more specifically the labour market –performs will be key in determining house prices changes in 2023.”
Average house prices in the UK hit a record high earlier this year, with data from Nationwide Building Society indicating in June that property prices in the North East had risen by a whopping 22.9% since the start of the pandemic in 2020. However, research from Plumbnation carried out in the summer revealed that the North East has seen the smallest increase by region in the average price of properties in the last decade, despite Newcastle, Sunderland and Durham all seeing house prices increase by 150% or more since 2002.
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