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Warning - house prices to fall much further

House prices are set to fall much further, a leading property expert has predicted. 

Last week credit ratings agency Moody's warned of a potential 10 per cent price drop over two years and also warned high inflation and the recent spike in lending rates will trigger a correction across all parts of the UK housing market.

Now a market commentator, Jonathan Rolande from the National Association of Property Buyers, says he fears this is an accurate assessment. 


"Aspiring home buyers, landlords and owners are set to be hit with another round of interest rate hikes just as many thought that the worst was behind us. Stubborn inflation at nearly nine per cent - a long way from the two per cent target - may lead to a Bank of England rate increase later this month and mortgage lenders have started preparing for it.

"Many mortgage deals have been pulled and replaced with higher-cost offerings. A £250,000 mortgage is currently some £400 more expensive than it would have been a year 

"Although the headline drop [currently] is only around three per cent the reality is much worse for sellers. Those that have a pressing reason to sell – divorce, probate, financial problems – may struggle and have to reduce further."

He continues: “It is difficult to see what might happen to stop the decline of UK house prices. With average prices failing to keep up with general inflation, it can be argued that property has already lost a substantial amount of value. It seems likely that the coming months will see further drops in prices, achieved quite possibly wiping off a few percent or so by the end of the year. 

“Moody’s prediction of a 10 per cent drop over two years may well be correct. The worrying thing here isn’t just the fact that homes will be worth less than many have paid, it is also the length of time things are predicted to be difficult. 

“Many homeowners are already struggling to meet their commitments each month, often relying on savings to get them through. Once these are depleted, we may well begin to see the spectre of mortgage arrears and repossession once again.” 

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  • icon

    I absolutely see repossession to be a real thing in the next year or so. 👎🏻😲

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    I don't see it myself. Yes house prices are coming down and if you need to sell right now you'll have to make prices attractive.
    However, most don't need to sell now and as such when interest rates cool off then it will stabilise.
    Last time I looked at the figures there were 24 million mortgaged properties, with 3 million of them on variable.
    There is still a housing shortage and builders are not building as much now as buyers are not buying.
    It's still stalemate!
    But of course Simon is right there will be more repossessions as some will be caught out by the 12 interest rate rises and probably a 13 and 14 one in the coming months.
    I noticed that USA put their rates on hold this month. Hopefully before the Summer has ended we can do the same.

  • Matthew Payne

    They have risen this year??? Why are journalists so obsessed with a rolling 12 months? Is it the only way to find a negative connotation? I was one of the few people back in the autumn amongst all the predictions of doom and gloom that bodly predicted we would see some house price inflation this year and not the 10-30% falls that were being touted. I still believe that, the economic indices like employment, wages, supply, demand all point that way. And wait till the first rate cut happens, the market is going to get very messy very quickly. Lots of fun to be had if you are an Agent.

    Peter Why Do I Bother

    The article in yesterdays Mail was Charlie Lamdin predicting a 35% fall..?!?!

    How does he arrive at that with a housing shortage and still not enough being built. I believe these so called experts are having a laugh at journalists expense.

    I will exclude Rob Dix from it as him and his mate appear to be the only sane ones reporting with a degree of balance.

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    Even if house prices don’t fall a great deal, the repo’s I am talking about are those poor deluded fools who purchased 2 years ago, with a 1% (or so) fix for 2 years at the same time they borrowed the max the lender would allow and over bid on the asking price 🆘 The new reality could mean their payments doubling on top of the huge increases in everything else, food and energy being the big ones……. They were drunk on cheap money and thought it would never end 🫤


    You will be right Simon, for the reasons you've quoted and others. I just hope it only effects the high risk takers. Bank of England need to take some responsibility here imo.

  • icon

    Ye ye ye the experts at it again and then whoops house prices once again exceeding expectation. It is simply chancers trying to manipulate the market.

  • icon

    Simon I think help 2 buy is a disaster too, roping them in with incentives and no SD ? to buy over priced Flat to make money for the big Developers all part of the game plan, Also Shared ownership the joke of the Century they take people for mugs.

  • icon

    Stop deluding yourselves. The market will fall by at least 20%+


    I admire your confidence!

    Peter Why Do I Bother

    Fairly bold statement there Ant, will you come back on to these posts when they haven’t fallen by 20%? Read above all the good people who have been involved in property for a long time. Shortages of rental properties, not enough being built leads to demand and that in turn leads to higher prices.

    Slight dip I will grant you but we have the big bonanza coming next few months with the strap line of we have saved the economy and vote for us, rates reducing …. I will come and apologise if I am wrong mid 2024


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