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UK House Price Forecast

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UK house prices have always been a hot topic. Homeowners want to know how much their property is worth, while potential first-time buyers need to know if their first home will be affordable. We’ve looked at property prices UK, examining why house price reporting differs and why. And made a UK house price forecast based of it.

How are UK house prices measured?

There are several ways to measure house prices, and these are done by different organisations using different data. As a result, UK house price forecast and predictions about whether UK property prices will fall or rise can vary.

Two of the best-known house price indexes are published by Nationwide and Halifax. Both these indexes use the respective lender’s own mortgage approval data, not data from the whole market.

Property portal Rightmove calculates its house price index using the asking prices of property listed for sale on its website. Asking prices can be very different to sale prices. Rival property portal Zoopla’s UK House Price Index is an analysis of property market data and annual price growth figures. 

The UK House Price Index, published by the Office for National Statistics (ONS), uses Land Registry data. This index includes both mortgaged and unmortgaged property, meaning it is probably the most accurate house price index although there is a time lag of several months between a transaction and its registration sold price.

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Are UK property prices falling?

As an overall trend, UK house prices are rising. However, the rate at which they are rising – known as ‘house price inflation’ – has recently started to slow and it will continue to go up and down over the course of time.

House prices might be rising in some areas but falling in others. These are known as ‘regional variations’.

The latest Halifax house price index, published in October 2022 using data from September 2022, found that house prices had fallen 0.1% from the month before. However, they were still 9.9% higher than the year before. According to Halifax, the average property is worth £293,835.

The most recent Nationwide house price index, from September 2022, found that house prices had gone up 9.5% from the previous year, but that the rate of house price inflation was slowing (it was 10% in August). Nationwide reported that the average house price in September was the same as in August – £272,259.

The latest Rightmove house price index found that the average price of property which came on to the market in October was £371,158; that’s 0.9% higher than in September and 7.8% higher than the same month last year.

Zoopla estimates suggest that house prices increased by 8.1% in September, a rate that’s down from 8.2% in August. It estimates the average property is worth £259,100.

The UK House Price Index, published in October 2022 and using data from August 2022, reported that the typical UK property is worth £296,000, which is 0.9% higher than July and 13.6% higher than August 2021.

Will UK house prices go down in 2022?

So, what is the UK house price forecast for 2022? House price data shows that house price inflation has started to slow in 2022. The most recent figures show that prices are starting to almost flatline month-on-month.

Increasing interest rates and mortgage rates will impact house prices in the remaining months of 2022 and into 2023.

UK house price forecast: will house prices go down in 2023 UK?

What does the UK house price forecast say about 2023? House prices have been quite volatile in the past couple of years due to the pandemic and the stamp duty holiday. Looking ahead, they will be affected by the cost-of-living crisis and rising mortgage rates.

Most experts predict that house prices will fall this year and next year.

  • Estate agency Knight Frank forecasts prices will drop by 5% in 2023, and a further 5% in 2024
  • Analysts Capital Economics predict house prices will fall by a total of 12% by mid-2024
  • Lloyds Bank predicts house prices will fall by 8% in 2023
  • Natwest estimates that house prices will go down by 7% next year

UK house price forecast: are house prices in UK rising or falling?

At the moment, UK house prices are still rising year-on-year. However, the rate of house price inflation is starting to slow.

House price inflation would need to be a negative figure for prices to be falling. Some experts are predicting that this will happen in 2023, but nobody has a crystal ball when it comes to a UK house price forecast.

Regional house price data could tell a different story, with prices rising in some areas but falling in others.


Last Updated: November 23rd, 2022