The Average UK House Price Decline Slows as Rents Surge to Record Highs

The UK housing market is experiencing diverging trends as house prices decline in some regions while rents surge to record highs across the nation. According to data from the Office for National Statistics (ONS), the average UK house price decreased by 0.2% in the year leading up to February, down from 1.3% in the year leading up to January.

In England, average house prices fell to £298,000, a 1.1% decrease, while in Wales they dropped to £211,000, a 1.2% decline. Scotland, however, saw a 5.6% increase in average house prices to £188,000, with the ONS attributing this jump to a fall in prices during the same period last year.

Meanwhile, in Northern Ireland, average house prices rose by 1.4%, reaching £178,000 in the fourth quarter of 2023. On the other hand, private rents in the UK surged by an estimated 9.2% in the year ended March, exceeding the previous record high set in February.

The average private rent in Britain was £1,246 in March, up £104 from the previous year. In England, the average private rent reached £1,285, a 9.1% increase, the largest rise since 2006. Wales saw a 9% rise in private rents to £727, while Scotland experienced a 10.5% increase to £947.

Experts are closely monitoring these trends, with Aimee North from the ONS noting the mixed picture in the housing market. The data release coincided with a decrease in the Consumer Prices Index (CPI) inflation rate to 3.2% in March. Matt Smith from Rightmove emphasized the resilience of the market amid global uncertainty and highlighted the stability in mortgage rates as a positive outcome.

Overall, the UK housing market is exhibiting varied dynamics, with house prices fluctuating across regions and rents surging to new highs. The impact of these trends on the broader economy remains a focal point for analysts and policymakers.