The latest Halifax numbers showed prices falling by 0.1% in November and 2.1% in the last three months. The annual rate of price falls is now 0.7%. It is, says Martin Ellis, housing economist at the Halifax, "consistent with a relatively flat overall trend in house prices".
But let's not forget as all too many people want us to that "flat" actually means "falling" at the moment. With RPI inflation well over 4%, your house is losing value in real terms every day. Indeed, if you take inflation into account which you obviously should UK house prices are already down 20% plus on their 2007 levels.
The bulls might think house prices aren't going to crash, but on many measures they already have. And it isn't over yet.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Ellis allows that a larger supply of houses on the market coupled with a falling number of buyers has led to the recent price falls, but he notes that as "homeowners are becoming more reluctant to put their houses on the market" further falls are unlikely.
There is a problem with this argument.
Sure, there might be fewer willing sellers around than there were; and a lot of the people who do have their houses on the market aren't really motivated sellers, and so won't ever cut their prices to the levels today's buyers will pay. But the market isn't just about willing sellers, it is about unwilling sellers too. And with unemployment quite likely to rise into next year, and with the inflation numbers suggesting that interest rates won't be able to stay ultra low for as long as the heavily-indebted might hope, their numbers may soon start to rise.
The market is also about buyers. And with mortgage approvals at historical lows and bank funding worries hitting mortgage availability, they remain very thin on the ground. Add it all up, and it sounds less like "flat" and more like "crash" to us.
-
Christmas at Chatsworth: review of The Cavendish Hotel at BaslowMoneyWeek Travel Matthew Partridge gets into the festive spirit at The Cavendish Hotel at Baslow and the Christmas market at Chatsworth
-
Tycoon Truong My Lan on death row over world’s biggest bank fraudProperty tycoon Truong My Lan has been found guilty of a corruption scandal that dwarfs Malaysia’s 1MDB fraud and Sam Bankman-Fried’s crypto scam
-
House prices to crash? Your house may still be making you money, but not for much longerOpinion If you’re relying on your property to fund your pension, you may have to think again. But, says Merryn Somerset Webb, if house prices start to fall there may be a silver lining.
-
Prepare your portfolio for recessionOpinion A recession is looking increasingly likely. Add in a bear market and soaring inflation, and things are going to get very complicated for investors, says Merryn Somerset Webb.
-
Investing for income? Here are six investment trusts to buy nowOpinion For many savers and investors, income is getting hard to find. But it's not impossible to find, says Merryn Somerset Webb. Here, she picks six investment trusts that are currently yielding more than 4%.
-
Stories are great – but investors should stick to realityOpinion Everybody loves a story – and investors are no exception. But it’s easy to get carried away, says Merryn Somerset Webb, and forget the underlying truth of the market.
-
Everything is collapsing at once – here’s what to do about itOpinion Equity and bond markets are crashing, while inflation destroys the value of cash. Merryn Somerset Webb looks at where investors can turn to protect their wealth.
-
Value is starting to emerge in the marketsOpinion If you are looking for long-term value in the markets, some is beginning to emerge, says Merryn Somerset Webb. Indeed, you may soon be able to buy traditionally expensive growth stocks on the cheap, too.
-
ESG investing could end up being a classic mistakeOpinion ESG investing has been embraced with enormous speed and zeal. But think long and hard before buying in, says Merryn Somerset Webb.
-
UK house prices will fall – but not for a few yearsOpinion UK house prices look out of reach for many. But the truth is that British property is surprisingly affordable, says Merryn Somerset Webb. Prices will fall at some point – but not yet.
