House prices fall similar to the UK's 2008 crisis
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Experts reveal to The Telegraph that house prices in the UK are currently in decline.
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London housing market in the UK. (AFP)
In a report published by The Telegraph, the website reveals that house prices are declining at the exact same rate as they did during the UK's financial crisis in 2008.
Figures from The Telegraph's new house price tracker raise the question of whether recent declines will level off or continue on the same trajectory, dropping by as much as 20 percent as in 2008.
The website compares data from Nationwide and Halifax lenders to demonstrate how much the price of homes has fallen since the housing crash of 2008. Because they are based on prices at the time of mortgage approvals as opposed to indices that look at properties' asking prices, both Nationwide and Halifax's indices are thought to provide a more trustworthy image of agreed sale prices.
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Property values have decreased by 5.7 percent, or £16,111, in five months since prices began to decline in August 2022, according to an analysis of the lenders' data.
The chart illustrates how house prices dropped exactly the same percentage during the first five months of the financial crisis, which began in the fall of 2007. Then, in 2008, home prices dropped by as much as 20 percent.
The average home's value would decrease from £284,000 to about £227,000 if current prices followed the same trend, a decline of nearly £60,000 from peak to trough.
Widespread expectations are for property prices to decline as rising mortgage rates reduce the amount that buyers can borrow. However, property experts are hopeful the reality may not be as bad as the figures currently suggest.
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Oxford Economics and Capital Economics analysts predict that prices will decline by 12 percent in 2023, as opposed to the 18 percent decline seen from 2008 to 2009, however, the fall might not be as severe as in 2008, but it might last longer.
During the financial crisis, prices dropped for 16 consecutive months, but Oxford Economics analysts expect this downturn to last 24 months.
