House prices continue to rise in Wales despite first UK-wide fall since 2023

Nation.Cymru staff/agencies

House prices in Wales have continued to rise despite the UK recording its first annual fall in property values for nearly three years.

The average Welsh property was valued at £230,282 in August, according to the latest Lloyds House Price Index, an increase of 0.6% compared with a year earlier.

That contrasted with a 0.4% annual fall across the UK as a whole – the first year-on-year decline recorded by the index since November 2023.

The average UK property was valued at £298,468 in August, down 0.2% during the month following a 0.1% fall in July.

There were significant differences between different parts of the UK.

Northern Ireland recorded the strongest growth, with prices rising 6.9% over the year to a record average of £231,245.

Prices in Scotland increased by 3.5% to £223,437, while Wales recorded more modest growth of 0.6%.

Several English regions recorded falls, including the South East, where prices dropped 1.6%, London, where they were down 1.5%, and the South West and Eastern England, which both saw declines of 1.2%.

Andrew Asaam, mortgages director at Lloyds, said: “The housing market has faced a more difficult backdrop in recent months, with the impact of global events on inflation and borrowing costs creating greater economic uncertainty.

“What we’re not seeing is a rush of homeowners cutting prices. But more are choosing to sit tight, with sellers reluctant to accept offers they feel are too low, while some buyers are waiting to see how conditions develop.

“As a result, fewer homes are changing hands, with latest industry figures showing mortgage approvals now at their lowest level since the start of 2024.”

Property transactions

UK residential property transactions fell by 1.7% in July to 96,710 on a seasonally adjusted basis, according to HMRC figures included in the report.

Mortgage approvals for house purchases also fell to 56,053 during July – 3.7% lower than the previous month and 14.9% below the level recorded a year earlier.

Mr Asaam said average UK house prices nevertheless remained around 25% higher than at the end of 2019 despite the substantial increase in interest rates in recent years.

He said: “We expect the market to remain fairly subdued in the months ahead, but this will likely only have a limited impact on house prices.

“While affordability remains a challenge, wages continue to grow and employment has held up better than many anticipated. This will help to support demand from those who need or want to move.”

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