Welsh house prices see fourth consecutive quarterly decline
The end of 2023 saw Welsh house prices fall to an average of £234,086, marking the fourth consecutive quarter of decline, according to Principality Building Society’s Wales House Price Index for Q4.
This represents a 6% decrease, or a £15,000 reduction, compared to the same period in the previous year, when prices peaked at £249,076.
Despite this significant annual drop, the largest since the 2009 financial crisis, prices are still 25% higher than five years ago.
Shaun Middleton, head of distribution at Principality Building Society, attributes the challenging market conditions to the cost-of-living squeeze and higher mortgage costs as fixed rates end.
He said: “It is little wonder that some have forecast continuing price falls in 2024, followed by a recovery in 2025.”
However, Middleton also points to signs of market recovery, including lower inflation and anticipated reductions in the Bank of England rate.
While most of Wales saw price declines, Cardiff and Caerphilly reached record highs at the end of 2023. Conversely, six local authorities, including Merthyr Tydfil with a 21.2% drop, experienced double-digit declines compared to the previous year.
Transaction volumes also dipped slightly to about 9,700 by the end of 2023, a 20% decrease year-on-year, with detached properties facing the steepest sales reduction at 27%.
Middleton remains optimistic for 2024, citing improving consumer confidence and potential government measures to stimulate the market. “It is an improving picture for 2024,” he concludes, suggesting that initial negative trends may give way to stability and growth over the year.