By using this website, you agree to our use of cookies to enhance your experience.
Graham Awards


House price drop of up to 10% next year - but NO market crash

A panel of experts forecast house prices will fall as much as 10 per cent by Autumn 2024.

Financial website Finder brought together academics, economists, mortgage and savings experts,to ask them for their predictions on what will happen to the base rate for the rest of 2023, and the impact this will have on the UK economy. 

Almost three quarters of the experts believe that house prices will fall between five and 10 per cent.


Charles Read, fellow in economics at the University of Cambridge expects house prices to drop by five to 7.5 per cent. He explained that “sharp rises in interest rates since the end of 2021 has reduced affordability of mortgages and new house purchases, pushing down prices”.

David Mcmillan, professor in finance at the University of Stirling expects a more severe reduction of 7.5 to 10 per cent. McMillan explained that household incomes will be “squeezed in several ways” next year and “as much as these economic conditions will lead to price falls, they will also likely lead to a fall in the volume of transactions.”

David Hollingworth, associate director at L&C Mortgages agrees that house prices will fall but not significantly, as he expects buyer confidence could grow. He commented that “as the rate outlook improves and mortgage rates stabilise and continue to improve, that could see buyer confidence begin to improve into next year which will likely see a soft landing.”

The experts are confident that a housing market crash is not on the horizon, with 73 per cent predicting the UK will avoid a crash of this kind. 

Luciano Rispoli, senior lecturer in economics at the University of Surrey commented: “Despite higher interest rates, housing demand is still strong and supply structurally low.”

Kate Steere, deputy editor at Finder, added that the UK housing market is “now in a period of adjustment, where prices have fallen and will continue to fall from their previous highs. But the fundamental concept of a shortage of supply and solid demand will stop house prices from spiralling downward.”

Sam Miley, managing economist and forecasting lead at CEBR was the only expert who anticipates that a housing market crash is on the horizon, citing high borrowing rates and a downward pressure on demand as the key causes: “Interest rates are expected to remain higher than their pre-crisis levels well into the mid-2020s. This makes borrowing more expensive, putting downward pressure on demand from buyers. It also makes debt servicing costs more expensive for those on flexible tariffs, which could encourage forced selling and hence an expansion in supply.”

Ten of the 11 experts expect that the base rate will now remain at 5.25 per cent until the end of the year, with just one expert predicting it will fall to 5.0 per cent in December. 

Paul Dales, chief UK economist at Capital Economics, believes that the base rate will hold at its current rate, and offered his thoughts on the longer-term picture, stating that “the Bank seems intent on keeping rates high for long rather than taking them higher and cutting them again. Our forecast that core inflation and wage growth will fall only slowly suggests that the Bank will keep interest rates at their peak for a long time - perhaps until late in 2024.”

Luciano Rispoli added, "I believe the Bank will want to wait for further inflation data before committing to a change of policy. Therefore, I believe that interest rates will be on hold for a while”.

Alan Shipman, senior lecturer in economics at the Open University, was the only expert to predict that the BoE will lower rates once more before the end of the year. He commented that, “falling inflation, slower fourth-quarter GDP growth, and signs of private-sector debt problems will persuade the MPC to start reducing interest rates by year-end.” 

Want to comment on this story? Our focus is on providing a platform for you to share your insights and views and we welcome contributions.
If any post is considered to victimise, harass, degrade or intimidate an individual or group of individuals, then the post may be deleted and the individual immediately banned from posting in future.
Please help us by reporting comments you consider to be unduly offensive so we can review and take action if necessary. Thank you.

  • icon

    THE RENTERS REFORM BILL will Collapse the Housing Market and the whole economy, the 10% drop will seem like a drop in the Ocean. Scrap it now, when you Collapse PRS you Collapse the whole Housing Market and the economy you seem to be relying on Housing to run the Country. Housing Minister Rachel Maclean & Housing Secretary Michael Gove are directly responsible for all this treasonable avoidable catastrophe.


    The "reforms" have been phased in in Scotland so that the private rental sector did not collapse. However, Labour plans when they take power in the country to implement an immediate Section 21 ban.

    The whole set of "reforms" by both parties seem to have been ill thought out. They could have given tenants more rights without causing landlords to sell up.

  • icon

    A panel of experts who are trying to be relevant are guessing again.


    I had to laugh when I saw the term '' academics'' what do they know about life in the real world and business

  • icon

    I don’t know where they get there numbers from. Chief reason seems to get an advertorial published.


    I don't see house prices collapsing, because there is still a massive shortage out there.
    They may take a little longer to come back to their previous value, but supply will be limited in the long term.

  • icon

    Are these similar’ experts’ to those who have caused the collapse of the PRS 🆘🆘. I do see them dropping a bit but the lack of supply will keep prices stable.

  • icon

    Prices are not falling, just not rising at the rate they did over last two years.

    Matthew Payne

    They have dropped a little, only 3.4% but in context thats not realy a fall when you consider the increases since the stamp duty holiday started in 2020, and a small correction every now and then is healthy. There is a massive pressure cooker out there of people wanting to buy, supply is still very low, as soon as we get a rate cut, we are going to see prices jump quite quickly as activity and demand materiaises in sales. That is not an environment for prices falling, let alone a crash. All the "experts" have predicted a house price crash every year with a different excuse, 2016 - 2019 was Brexit every year, 2020 was pandemic, 2021 was stamp duty holiday ending/recession, 2022 was Ukraine/cost of living, 2023 inflation/rates, 2024 is mortgage options by the looks of it. Say it enough times, they might get it right one year, albeit noone predicted in 2007, asleep at the wheel.

  • Andrew Murray

    Please re publish this post in 12 months with the official figures regarding house prices. I believe house prices will increase as mortgage interest rates go lower and increased wages give people more money for deposits. If the so called academic experts are wrong then they can be dispensed with so their worthless predictions are not used or printed in future.

  • icon

    Academic economists are over paid mediums 🔮!
    Their predictions are rarely correct and when they are correct they think they deserve a Nobel peace prize or world wide fame like Michael burry.

    Haven’t heard any economists predicting the Renters reform bill will bring an avalanche of property inventory to the market creating a huge imbalance in the supply side of the market and crash the housing market and possibly the UK economy with it.

    If any of them had a modicum of common (non academic) economic sense they would be saying to the UK civil servants and government politicians that we have depleted North Sea fossil fuel reserves a depleted non existent manufacturing base and our economy is now fully reliant on the financial services and property real estate sector and to meddle with them in an economically insular brexit Britain will be economic genocide.

    Anyway less doom and gloom from me i’m of to get a coffee and a copy of the FT have a good day ladies & gentleman.

  • icon

    I cannot understand why politicians, who cause so much havoc and disaster by introducing ludicrous policies or any guidelines that are to be acted on, are above the law and not punished for causing treason. They need to be accountable when their policies cause disasters or back-fires.


Please login to comment

MovePal MovePal MovePal
sign up