Kate Faulkner's property price and market report - June 2023

publication date: Jun 27, 2023
author/source: Kate Faulkner OBE, Property Expert and Author of Which? Property Books

Kate Faulkner's property price and market report - June 2023
Why is transaction data so important?


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Summary of property price and market indices

National property prices

Property prices by country

Regional property prices

City/town property price tracking

Demand, supply and transactions

Where is the market going?


The UK’s most comprehensive property price report

This report is to help give everyone – industry and consumers – a quick five-minute guide to what’s happening in the property market, according to the property indices, along with property expert Kate Faulkner’s comments.


Property price and market indices summary

Prices hit record high as new sellers respond to improving market
“Average new seller asking prices jump by 1.8% this month, compared with the historical average May rise of 1.0%. This is a new record high of £372,894 as sellers respond with increased pricing confidence to a market that is defying start-of-the-year expectations.”

Prices jump on spring optimism
“Asking prices across England and Wales surged during April by 0.8% on a wave of optimism, although year-on-year growth slipped further into the negative (-0.8%).”

Forward-looking indicators again turn slightly less downbeat but clouds are gathering on the horizon
“National house prices are still falling although downward momentum continues to ease.”

Annual house price growth slips back in May

“Following tentative signs of improvement in April, annual house price growth softened again in May, falling back to -3.4% (from -2.7% in April).”

UK house prices flat in May as annual growth turns negative

“House prices were largely unchanged in May, edging down very slightly (-£130) compared to April, with the average UK property now costing £286,532. More notably the annual rate of growth fell to -1.0%, marking the first time since 2012 that house prices have fallen year-on-year. Given the effectively flat month, the annual decline largely reflects a comparison with strong house prices this time last year, as the market continued to be buoyant heading into the summer.”

Ninth month of falling annual rate of price growth…
“…but average price still £ 7,360 ahead of twelve months earlier. The annual growth rate in England and Wales in May 2023, for both mortgage and cash-based house purchases, was an arithmetic average of 2.0%. This is 0.1% below the revised rate of 2.1% in April 2023 and represents the ninth month in succession in which the annual rate of house price growth has slowed from the +12.9% seen in August 2022. It is however the smallest reduction in these nine months, perhaps suggesting a slowing in the rate at which house prices are falling.”

UK house prices fall 1.3% over the last 6 months

“The annual rate of price inflation is 1.9%, down from 9.6% a year ago.”


Download Kate Faulkner's latest property price and market report here


What are the indices saying is happening to house prices today versus the past?

National property price tracking


What a difference a year makes!
I thought it would be interesting to see the comparison between last year’s national property price tracking versus this year’s – and it’s clearly a big difference!

This time last year, average changes to property prices year on year were 6.6% to 11.2%, but in comparison this year, you can see the range shows falls from Nationwide year on year of 3.4%, with Home.co.uk and Halifax showing smaller falls, through to asking prices up by 1.5% from Rightmove, offers accepted prices from Hometrack of 1.9% and sold property prices up 4.1%.

The one thing that is true, is that prices definitely peaked back in the late Summer of 2022 and are now correcting themselves from the ‘froth’ they had last year – when forecasters had predicted prices would be up by a few percent, not the 6.6% to 11.2% they actually rose by.

And, it’s interesting to see the mix of demand this year – which, according to Rightmove, is much higher for FTBs than we expected this year: Buyer demand is 1% lower than in 2019 for top-of-the-ladder properties, compared with 3% above 2019’s level in the second-stepper sector, and 6% above in the first-time-buyer sector.”

Halifax have also reported some interesting target market results which show differences in market performance:

  • Existing houses continued to fall in value (annual growth of -1.9%)
  • New build properties are still rising (+2.8%), although at the weakest rate for nearly three years
  • By property type, all except for detached houses (+0.4%) have registered year-on-year declines
    The sharpest drop is for flats (-1.9%), followed by terraced (-1.0%) and semi-detached houses (-0.5%)

Most, although not all, of the indices are suggesting that there has been a bit of a flurry of activity for some buyers and sellers over the last few months.

The big question though is whether this will last, especially with the upward movement of rates we had hoped had peaked. The question is with these higher rate rises and indeed hotter summer days - which can put buyers off house shopping - will we head into a quieter summer?

Nationwide have been brave enough to answer this question for the rest of the year, stating in their latest release that “…in our view a relatively soft landing remains the most likely outcome since labour market conditions remain solid and household balance sheets appear in relatively good shape.

“While activity is likely to remain subdued in the near term, healthy rates of nominal income growth, together with modestly lower house prices, should help to improve housing affordability over time, especially if mortgage rates moderate once Bank Rate peaks.”


Download Kate Faulkner's latest property price and market report here


Property prices by country


All the indices this month for each country are now reflecting the slower market, with double digit rises in the distant past and, according to mortgage property measures from Nationwide, we are slipping into negative territory, bar Northern Ireland which is just hanging on to positive growth. However, it’s important to remember, prices in NI are still well below their 2007/8 peak.


Summary from the indices of the Scottish housing market

House price change in March is static
“The average house price in Scotland in March 2023 has increased by some £2,900 - or 1.3% - over the last twelve months. This annual rate of growth has decreased by -1.5% from February’s 2.8%, which is a slightly smaller fall than the reductions of -1.8% and -2.0% seen in January and February.

“In March 2023, 22 of the 32 local authority areas in Scotland were still seeing their average prices rise above the levels of twelve months earlier, one less than in February. Interestingly, only one of the top fifteen areas ranked by value had price falls over the year, whereas in nine of the bottom seventeen areas ranked by value prices fell. It would thus appear that the areas with higher-value homes have maintained rising prices over the year. The exception is Edinburgh, being the one area in the top 15 where the average prices of all property types - except terraces - have seen a fall.

“The area with the highest annual increase in average house prices in March 2023, for the third month running, was Clackmannanshire, up by 15.8%. The Clackmannanshire average values have been enhanced by the sale of a £780,000 5-bedroom detached home in Dollar. Given the low volume of transactions in Clackmannanshire - only 50 for the period from January to March 2023 - the area is frequently associated with volatile movements in its average prices. In second place is Midlothian, with an annual increase in prices of 9.4%. The gain in the Midlothian average price has been assisted this month by the sale of a detached home in the grounds of Melville Castle, with a price of £1.88 million.

“On a weight-adjusted basis - which incorporates both the change in prices and the number of transactions involved - there were six local authority areas in March which accounted for 50% of the £2,900 increase in Scotland’s average house price over the year. The six areas, in descending order of influence, are: – South Lanarkshire (15%); Midlothian (9%); Perth and Kinross (9%); East Renfrewshire (6%); Highland (6%) and Aberdeenshire (5%).”


Regional property prices tracking

As property price growth abates and for some goes into reverse, the gap between different regional performances has narrowed. Nationwide are showing the Midlands and South West to still be slightly increasing house price wise, but only by less than 1.4%. Meanwhile, all other regions are falling by anything from 0.4% (North West) to 1.8% in the East.

In contrast to mortgage property prices, Rightmove are showing the North East to be the only region showing a decline - but only by 0.2%, while the big ‘winner’ in the last month is Yorkshire and Humber, with asking prices rising at nearly 4%. The Land Registry still shows rises, but this is just because prices lag behind other indices. 

“Prices continue to fall on an annual basis across southern England, again led by the South East (-1.6%, average price £385,943), and closely followed by the South West (-1.4%, average price £301,079). In Greater London prices are down over the last year by -1.2% (average price £536,622).

“Except for Wales (unchanged at +1.1%, average price £218,365), all areas of the UK have seen annual house price growth weaken in May compared to April, with most now recording a low single-digit rate of property price inflation.

“The West Midlands (+2.7%, average price £251,137) remains the best performing region, followed by Yorkshire & Humberside (+2.3%, average price £205,035).

“Scotland (average price £201,596) saw annual growth drop to +1.3% (from +2.2% in April). In Northern Ireland (average price £187,334) growth was +1.5% over the last year (from +2.7% in April).”

Weaker demand where prices have outpaced earnings
“The variation in activity across regional markets is most likely explained by the level of recent price growth. Above-average growth has impacted the affordability of homes. It has also increased the sensitivity of would-be home buyers to higher mortgage rates.

“House price growth over the last 7 years has ranged from just 12% in London to 47% in Wales. Average earnings increased by 30% over the same period. Areas with house price growth outpacing earnings align with those where demand is below average at present. In contrast, the regions and countries with the lowest rate of price inflation since 2016 are recording stronger activity.

“London is not an affordable market with average house prices 2x the UK level. However, low price inflation has improved affordability. There is better value for would-be buyers, especially those looking to buy flats where prices are unchanged since 2016. Increased migration into the UK is likely to be supporting market activity in London.”


Download Kate Faulkner's latest property price and market report here


City/town property indices price tracking

For city/town tracking, we use Land Registry (government data) and Zoopla/Hometrack. The Land Registry data is useful because we can analyse how property prices have changed over time and this helps us to put today’s price information into context.

The Zoopla/Hometrack data is useful as they take into account the change in mix of property transactions during the pandemic to houses away from flats. This has meant the likes of the Land Registry and other indices have over exaggerated price increases year on year.


Commentary on towns and cities

Overall, out of 30 cities, since 2005, property prices have risen above inflation in nine cities/towns, including Bristol, Oxford and Edinburgh, on par with inflation is Tunbridge Wells and Leicester, and in all the remaining towns and cities, price growth has remained below inflation. Even with the price growth seen during the pandemic, what this shows is that, in real terms, especially for those that own outright the property they have isn’t necessarily delivering from an investment perspective. 

Topping the price growth charts according to Land Registry and Hometrack:- 

Lowest performers are:

The top and lowest performers comparison between Land Registry and Hometrack are pretty close this month, albeit the growth is lower for the more timely Hometrack index.



“In April 2023, 91 of the 110 Unitary Authority areas in England and Wales were still recording house price gains over the last twelve months, indicating the wide extent of price rises that had taken place across the two countries, even if the growth rate is now diminishing. This does however contrast with the 104 authorities that saw prices rise on an annual basis in March – annual gains are therefore diminishing.

“The area with the highest annual increase in prices in April 2023 is Windsor and Maidenhead, at 13.5% growth – the average price being assisted this month by the sale of a five-bedroom detached home for £2.5 million.

“By way of contrast, the Unitary Authority area with the largest fall in prices over the last twelve months is Bracknell Forest, at -8.9%. All property types in Bracknell Forest have seen reductions in their average prices over these last twelve months.”



Download Kate Faulkner's latest property price and market report here


Demand and supply

Despite much of the media focusing on property prices, from a buyer’s/seller’s perspective, for the industry and indeed for the economy, what’s more important is the data we receive on transactions.

This year, it’s fantastic to have up to date information on new instructions and sales and as the charts show below, compared to pre-pandemic levels, actually this year isn’t bad at all. So far, we are seeing good levels of new properties coming onto the market – up there with 2018 and 2019.