UK house prices fall at sharpest rate for 14 years, says Nationwide
Mortgage costs hit the highest level for 15 years in July as lenders grappled with inflation and uncertainty over rates set by the Bank of England. Mortgage rates have been rising following a succession of interest rate rises by the Bank of England to tackle stubbornly high inflation. Soaring food and energy bills have helped drive inflation up. So, as UK house prices are falling, why are home buyers still struggling?
Category
🗞
NewsTranscript
00:00 According to Nationwide, UK house prices dropped at their fastest annual pace for 14 years
00:06 in July.
00:07 The Building Society said prices dropped by 3.8%, which is the biggest decline since July
00:12 2009.
00:13 But despite this, mortgage interest rates remain high, meaning affordability continues
00:17 to be a challenge for house buyers.
00:19 Nationwide said that affordability remains stretched.
00:23 The average price of a home in the UK at the moment is over £260,000, which is 4.5% below
00:29 the peak of August last year.
00:31 Robert Gardner, chief economist at Nationwide, said a prospective buyer earning the average
00:35 wage and looking to buy the typical first-time buyer property with a 20% deposit would see
00:41 monthly mortgage payments account for 43% of their take-home pay, assuming a 6% mortgage
00:47 rate.
00:48 This is up from 32% from a year ago.
00:50 The bank is expected to raise interest rates again on Thursday from 5% to at least 5.25%.
00:57 [BLANK_AUDIO]