- Written by Katherine Evans
- bbc news
House prices in Wales have fallen by the most since 2009 following the financial crisis, new figures show.
The average house price at the end of 2023 was £234,000, down 6% from the previous year’s record high, according to the Duchy Building Society.
Merthyr Tydfil was the biggest faller, with prices falling by more than 20%.
Gwynedd, Anglesey, Cardiff and Caerphilly were the only areas where prices increased.
This is the fourth consecutive quarter that prices have fallen in Wales.
The figures are released from the Principality Building Society’s October-December 2023 Wales House Price Index, which shows the rise and fall in house prices in each of Wales’ 22 local authorities.
House prices in Wales are currently down 6%, or £15,000, compared to the same period last year, when a peak price of £249,076 was recorded.
This was the biggest year-on-year drop in average house prices in Wales since 2009, in the wake of the 2008 global financial crisis.
Despite this, home prices are still 25% higher than they were five years ago.
Two local authorities, Cardiff and Caerphilly, reported record prices of £308,648 and £207,904 at the end of 2023, with 18 of the 22 local authorities recording year-on-year price declines. It was revealed that the market was in a slump.
All six local authorities – Monmouthshire, Carmarthenshire, Blainau Gwent, Torfen, Denbighshire and Merthyr Tydfil – experienced double-digit price declines compared to the same period last year, with Merthyr Tydfil at 21.2. reported the largest decline of %.
Sean Middleton, head of sales at Principality Building Society, said: “The Welsh housing market is going through a difficult period.
“Given that households are moving away from significantly lower fixed interest rates and the cost of living continues to be squeezed with rising mortgage costs, some are predicting that prices will continue to fall in 2024, with a recovery in 2025. No wonder.”
He added that there were “some encouraging signs”, including falling inflation and the Bank of England interest rate, which has now peaked at 5.25% and is expected to fall during 2024.
“Indeed, financial markets are pricing in multiple rate cuts, with the Bank of England rate expected to be cut to 4% by the end of the year,” he said.
“Mortgage markets are already moving, with lenders cutting interest rates significantly as competition increases, and we may expect this to continue.”